According to Seattle-based Zilliow, nearly one-third of U.S. home buyers who bought in the last five years are now underwater. A full 45% of those who bought at the peak in 2006 have negative equity in their homes. Negative equity makes it hard to refinance a mortgage and has been a direct contributor to foreclosures. According to Zillow, 15% of home sales were foreclosures in the second quarter.
See the full Bloomberg story: One Third of New Owners Owe More Than House Is Worth