There is a stunning graph about foreclosures between 2005 and 2010 here. One of the pieces of info contained therein is that 23.3% of ALL mortgages are underwater. Not of sub-prime mortgages, or mortgages taken out during the boom, or mortgages in Florida, etc. That's 23.3%, or nearly a quarter, of every single mortgage in the US of A is underwater. The chart also shows that there will be over 1 million homes repossessed in the US in 2010.
Just when you thought it might be safe to go back in the (real estate) water:
These seriously delinquent loans are the 4.3 million loans MBA Chief Economist Jay Brinkmann referred to as the "shadow inventory" on the conference call this morning. Not all are really "shadow inventory" since some of these loans will be modified, some will be cured (probably very few), and some are probably already listed as short sales. But it does suggest a significant number of distressed sales coming…
Thirty four states and the District of Columbia have total delinquency rates over 10%. This is a widespread problem.
I was doing some research for the day job and came across this article about a panel discussion on the future of GSEs (Fannie Mae and Freddie Mac). There are several good quotes contained within, but these two really caught my eye:
But according to White and Booher, it was a broader cultural issue, an unbalanced federal housing policy that stressed homeownership at the expense of rational underwriting. “I believe that the deception of our culture, that money grows on trees, that there can be action and no reaction, is so prevalent that we live in a fantasy world,” White said. “And members of Congress were the ultimate actors there.”
That unbalanced housing policy was prevalent on the operations side as well. "The problem really starts with a culture that’s increasingly looking for something for nothing,” Durkin of Wood Partners explained. “That permeates our housing policy.”
I really do hope my children's generation ends up being smarter than mine or my parents'.
I'm not sure if this made the local news and I just missed it, or if it's been flying under the radar, but there's a program in Winston-Salem and Forsyth County to help folks buy foreclosed properties. Back in January I got an email from Sen. Burr's office about North Carolina receiving over $52 million for the Neighborhood Stabilization Program, but didn't really hear much after that. Then today the following item from FindForeclosureProperties.com (nice URL huh?) showed up in my Google Reader:
Housing officials in Forsyth County and Winston-Salem, North Carolina have partnered with the Center for Homeownership and financial institutions to help eligible buyers purchase bank foreclosures for sale for less than the properties’ appraised value.
Under the Neighborhood Stabilization Program (NSP), eligible homebuyers will be able to receive a maximum of $20,000 as deferred forgivable loan. The funds will be used by the eligible buyer as down payment for buying foreclosure houses, provided that the mortgage holders are willing to sell the properties for less than their assessed value…
Furthermore, the home buying assistance initiative is open to first time property buyers and families or individuals who have not purchased or owned a house for three years.
Eligible borrowers will not be required to pay back the loan under the NSP program if they opt to stay and live in the property for not less than 20 years. Additionally, homebuyers should have the properties under sales contract on or before July 18, 2010 in order to become eligible for the program.
Prospective buyers should have household earnings of equal to or not more than Forsyth County’s 120 percent median income which for a four-member family is $71,640. The median income restriction varies with the family size.
I'm not sold on this being a good idea. Will this prompt people who may not be financially ready to buy a house and then, a year or two down the road, be in over their heads and threatened with foreclosure themselves? Normally you might say that the banks wouldn't lend to risky buyers, but given what we've learned over the last two years do we really want to trust the banks with their own due diligence?
I appreciate what the program is aiming to do, but like I said I'm not sold on it's merits.
Here's the link to the county's page dedicated to the NSP.
Coldwell Banker Triad Realtors has launched a mobile version of their listings so that house hunters can use their Blackberries, iPhones, etc. to look up listings. Not sure how many local realtors have done this, but I think if they haven't then they'll need to get on the stick pretty quickly. I think the days of carrying around listing printouts are numbered.
Anyone know if ListingBook has a mobile version?
I love positive thinking, especially the variety that goes something like this: "Yes, you lost your foot in that freak bicycle accident but on the positive side you still have your leg!" Thus you'll understand why I really like this story from the Winston-Salem Journal titled Existing-Home Sales Up for Fourth Month and this excerpt in particular:
The Winston-Salem Regional Association of Realtors said yesterday that 324 homes were sold last month, up 3.8 percent from the 312 sold in March.
"While it is not uncommon for sales to increase month over month for the first half of the year, it is encouraging in this climate that we are returning to more normal home-buying patterns in our community," said Phillip Rector with Mundy Realty and the president of the association.
Still, April home sales were down 34.8 percent from April 2008, when 497 homes were sold. The average sales price was $157,000 last month, down 11.3 percent from $177,000 for the same period a year ago
I think a better gauge of how good this news is (or isn't) would be to compare the growth from March-April in 2008 with March-April of this year. While this story tells us that home sales were up 3.8% from March to April of 2009 we don't know what the increase from March to April of 2008 was, which means we don't know if we have better or worse growth than last year. If housing sales actually declined this time last year then it makes the fact that April sales this year were down 35% from last year not so bad, because last year sales were sliding from month-to-month and this year they're on the rise. But if March-April sales last year were actually an increase of 7% then that means that not only are the year-to-year comparisons bad, but the seasonal growth in sales this year is also worse than last year, which makes the news really bad.
Long story short: I really hope the news is good, but the data given in this story doesn't really tell us if it is or not.
Let's just say I continue to be glad that we're not trying to sell our house, nor do we plan to in the next few years. Triad home sales down 25% in April.
A couple of days ago I wrote about my hope that due to a decrease in foreclosure rates here in North Carolina we are actually a leading indicator that the nation's economy has hit bottom. My friend Dan called me a pie-eyed optimist as a result. I did temper my post with the news that home sales in Greensboro were down 38% in February from same month sales the year before, so I wasn't real shocked when I read today that Winston-Salem's home sales in February were down 30% from the year before. Average home prices were also down, but given the number of foreclosures on the market that's not exactly a shock either.
One of the Google Alerts I have set up is "forsyth county nc" and it regularly sends some interesting items to my Google Reader. For instance I get lots of links from a site called bankforeclosuressale.com that include the addresses of houses listed in their database as being in foreclosure. Here's this morning's sampling:
According to this story in USA Today one in nine American homes is vacant. 10.1% of rental units are vacant and 2.9% of homeowner units are sitting empty, and the total number is over 14 million units nation wide. Housing units worth over $500,000 are just as likely to be empty as those under $100,000. 9% of units built after 2000 are empty compared to 2% of older homes. In other words the units sitting empty aren't just squats in crumbling industrial cities, and in fact they are more likely to be developments that promised a piece of the American dream in the newly landscaped suburbs and exurbs.
Befuddled 