United States has witnessed numerous periods of economic depressions and boom ever since it came into existence. At this moment too, US is passing through one of the most difficult times economically. Fiscal deficit, high unemployment and falling exports have hit many of its sectors badly. The housing sector too has been severely affected by the 2008 economic crises.
Prior to the 2008 economic crises, the housing sector was witnessing one of the largest economic booms in the history of the country. The demand for houses went over the roof and as a result people started to indulge in speculation and the boom eventually turned into a massive housing bubble. (Bardhan, Edelstein and Kroll, 24)
The sector is still in a bad shape. Number of people defaulting on their mortgages is still extremely high and the total worth of the houses which has been kept as collateral is still far below the total loan amount borrowed by the house owner. High unemployment levels and excess inventory has also made matters worse for the overall sector. (NAHB)
Though the delinquency level is extremely high, the percentage of people who defaulting on their loan installments have reduced to the lowest levels since the beginning of the crises in 2008. The decline in percentage means that more and more people are paying their installments on time which is a beneficial not only for the banks but for the overall housing sector. (Delinquency Decrease)