The economy’s prolonged malaise, now stretching into its fourth year, is having a lopsided effect on the ultra high-end home owner.
Since 2008, payment delinquencies and foreclosure activity for $1 million-plus mortgages have skyrocketed nationally, rising to roughly double the rates recorded for home loans below that pricey threshold. The reversal of fortunes was captured in a recent analysis by CoreLogic, a housing research and services provider base in California, which found that until around three years ago, the million-dollar mortgage crowd had a superior payment and credit record relative to the rest of the market. The recession and late-2008 credit crisis altered those metrics, as mortgage delinquencies and foreclosure activity spiked among luxury homeowners.
Their footing has only worsened in the years since.
According to CoreLogic, the 90-day delinquency rate for million-dollar mortgages stood at 13.8 percent in July, rising from less than 1 percent roughly five years ago. By comparison, the delinquency rate for all other mortgages has failed to top 8.5 percent since the crisis began, and as of July it held at 7.1 percent, according to CoreLogic.
The market's changes have rippled through many of Greater Boston's wealthier suburbs.