The collapse of the real estate market helped trigger the economic collapse of 2008. Now 28% of all homeowners are underwater. There is no sign of any pickup in the housing market. With only low paying jobs available banks are not making home loans. No one is willing to buy knowing full well that they will lose whatever money they put in down payment. While the rest of the economy is in a inflationary cycle, deflation is occurring in the housing market.

If you have no desire or need to sell your home, then falling home prices are just on paper and likely temporary, right? Depends on how you look at it.

Falling home prices put more borrowers in a negative equity position, that is owing more on their mortgage(s) than their homes are worth. We call that “underwater,” and for good reason, because for some borrowers that sense of drowning in debt has profound implications.

Today Zillow.com reported a new high in negative equity: 28.4 percent of single family homes with a mortgage (remember, 32 percent of all homeowners do not have a mortgage).

This is not good news and it means millions of Americans are stuck in their homes. Mobility was a feature of America’s economy. Now people are stuck and can’t seek employment in growing areas due to the inability to sell their homes. I’m one of these who have negative equity, I’m stuck where I’m at. There’s no solution in sight to this problem.