Shatter prices8/8/2023 ![]() It is widely seen in the best interest of banks, housing market and the economy for the banks to sell the foreclosed homes in a measured way to prevent prices from swooning anew. “We just don’t see that as being realistic.” “The doomsday prognostications say that gives you 7 million properties that are all going to go back to the banks, that are all going to hit the market at the same time and we’re going to have a smoking crater where there used to be a real estate market,” Sharga said. ![]() There’s another million properties in foreclosure and 5.5 million delinquent loans. The pace at which banks start selling these houses is critical for gauging how much further home prices will fall.īanks have half a million houses on their books yet to be put on the market, RealtyTrac said. BANKS SEEN HOLDING FIREīanks repossessed a record of more than 918,000 properties last year, 6.5 percent more than in 2008. states.Ĭalifornia, Florida, Arizona and Illinois accounted for more than half of all foreclosure actions in 2009 as more than 1.4 million properties got a notice. California, Utah, Idaho, Georgia, Michigan, Illinois and Colorado were the other states with loan failure rates among the 10 highest for U.S. Arizona and Florida were in second and third places. Nevada had the highest foreclosure rate for the third straight year, with more than 10 percent of households with loans getting at least one notice. It was the tenth straight month that notices topped 300,000, driving the year’s total to a record of more than 3.9 million. Yale University economist Robert Shiller, a creator of the S&P/Case-Shiller home prices index, told Reuters on Tuesday he expects renewed price erosion in coming months.įoreclosure notices were made on more than 349,000 properties in December, a 14 percent jump from November despite various moratoria, RealtyTrac said. “We haven’t seen any appetite for that on the part of the lenders yet,” he added. ![]() “Until the lenders start to get into principal balance reduction you’re going to continue to see high redefault rates,” Rick Sharga, senior vice president at RealtyTrac, said in an interview. State, federal and private efforts to modify loan terms for at-risk borrowers either don’t go far enough or are expanding too late to help many struggling homeowners on a permanent basis, many industry experts and economists agree. Filings include notice of default, auction sale or bank repossession. In many cases loan fixes don’t stick, however, and so a new record of at least 3 million properties getting a filing is seen in 2010. The loan failure rate - and thus the fallout for home prices and the economy - would have been even worse without foreclosure prevention programs and loan processing delays caused by sheer volume, the company said. REUTERS/Lucy NicholsonĪ record 2.8 million properties with a mortgage got a foreclosure notice last year, jumping 21 percent from 2008 and 120 percent from 2007, the Irvine, California-based real estate data company found. A foreclosed home is seen in Bullhead City, Arizona, November 4, 2009.
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