A lot of so-called "homeowners" don't actually own anything yet. Many owe the bank significantly more than their home is worth, RealtyTrac statistics show.

In Tucson, one-third of existing mortgages - nearly 83,000 homes - are "seriously underwater," meaning the amount owed on the loan exceeds the home's value by at least 25 percent.

But buyers who purchase homes they can afford - and who aren't planning on using the property as a short-term ATM - needn't be troubled by volatile property values or "underwater" status because they're in it for the long haul, says Gary Bachman, program manager with the Pima County Community Development and Neighborhood Conservation Department. He manages the county's $22 million Neighborhood Stabilization Program grant.

"If we see housing as an investment, it'll always be problematic. But if you see housing as a home, you have a different perspective," Bachman says.


Strategic defaults - that is, choosing foreclosure rather than making payments on a house with a plummeting value - have been blamed for worsening the housing crisis. But foreclosures rates track more closely with unemployment rates, rather than rates of underwater mortgages, says Brent White, professor at the University of Arizona's College of Law and author of the 2010 book "Underwater Home."

That suggests that homeowners are defaulting when they absolutely have to - not when they realize it is a better financial decision to walk away from a mortgage they will never pay off, he says.

That's not necessarily a good thing, he says.

Society imposes a moral obligation on individuals not to default, but lenders impose no such obligation on themselves to try to keep struggling borrowers in their homes during an economic crisis, White said at a spring housing symposium in Tucson, sponsored by the Drachman Institute.

That gives lenders an unfair leverage in negotiations with borrowers over loan modifications, he says. He advocates scrupulous use of strategic default for borrowers who won't be able to save their homes anyway.

"Banks won't go bust if they take some losses. ... Homeowners are bearing more of the fallout because of this unfair moral decree," he says. On the contrary, "it's actually profoundly immoral to say that average people are supposed to destroy themselves financially before they're entitled to make a financially sound choice to default on their mortgage."