Foreclosure Filings Rise 32% Year-to-Year
REO properties will continue to make up a large part of the housing market for some time to come, judging by the latest foreclosure and mortgage data.
In July, foreclosures were up 7% from June - and 32% from July of 2008. 360,000 homes were in some stage of the repossession process and on their way to becoming REO listings. That's one out of every 355 homes in America - and it marked the third month out of the last five that a new record was set.
While the usual states led the foreclosure numbers - California, Nevada, Florida and Arizona - there were also big jumps in states that hadn't been experiencing big default rates - states like Oregon, Minnesota and Kansas. Experts say that's because of the increasing effect of the jobless numbers.
This brings us to mortgage delinquencies, which hit an all-time high in the second quarter of this year. The number of mortgage holders who were behind 60 days or more on their payments was up 65% from the second quarter of 2008. Almost 6% of homeowners nationwide are having trouble - with Nevada having an astounding 13% delinquency rate.
The good news? As we reported last month, REO home sales are finally taking off - which means prices have hit the point where investors are actually anxious to get in on the available deals. That trend really caught fire in July - with California leading the way with REO sales, just as they led the way nationwide with the initial housing crash.
To cite one dramatic example, Stockton, the city with the highest foreclosure rate in the country, saw its home sales double in the second quarter - and about 40% of those sales were REO properties. In some cases, there were actually bidding wars on REO homes, according to DataQuick Information Systems.
This is great news for REO agents and brokers - house prices have finally fallen to a point where REO inventory is beginning to move in a big way. Ryan Ratcliff, an economist at UCLA, believes that discounts of as much as 50 percent will continue well into 2010.
The other good news is that there's still plenty of REO inventory to come. Many foreclosure homes that haven't been selling have actually been taken off the market and put up for rent. The result? A lot of vacant rental homes! Those will undoubtedly be put back on the block - and with buyers finally reentering the real estate market in search of deals, they will finally have a shot at selling.
No comments:
Post a Comment