Foreclosure rates still going - when will it stop?
http://money.cnn.com/2008/07/10/real_estate/foreclosures_no_break/index.ht m?postversion=2008071008
Will it be this year, next or the year after (2010)!?
Answers
952 points
rvilmur answered one year ago …
I don't expect it to settle out until 2010 at the earliest. There are many more adjustable rate house loans that mature well into 2009. With the drop in home prices, many more people will walk away from there homes because they have negative equity in them and it is cheaper to rent than to continue to pay the mortgage. There is also a huge amount of real estate for sale now and that will take years to work off. So, until all the foreclosures and abandonments are finished, there is no possibility of the housing supply diminishing.
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951 points
Grudun answered one year ago …
When will it stop, NEVER. When will it get back to semi-normal levels, by my estimates in the 2010 home buying season. However we should be seeing the peak soon. The peak of the loan adjustments in $s was in the March-April time frame. Then you go out about 3-6 months for the worst of the forclosures to hit(forclosure takes time and some people can struggle along a little longer) which is exactly the time period we are in now. The next big hit to home prices will come in September-October when the number of buyers suddenly drops(most families don't want to move during the school year).
Any recovery is also dependant on lenders relaxing a little bit. Most people who could afford to buy with a significant down payment(or would have been able to right now) bought over the last couple years with the easily available credit. Right now there are a lot of people who want to buy but only have small down payments(2-5%) who are being turned down by lenders despite great income and credit scores. If lenders don't slowly move off of the overreaction and slightly relax lending standards(of course full doc, but be reasonable with down payments) they could prolong the pain for themselves and the housing market in general.
3966 points
EthanR answered one year ago …
I like both the answers above. Just to add my two cents, I don't see the return to normal levels of foreclosures until 2011, and this is why. There are a ton of so called "short sale" homes flooding the markets now, well at least in Florida. Maybe others can talk about their areas of the country. These short sales are not being sold because the banks take their sweet time getting back to the agents and buyers on their presented offers. It can take up to 60 days for an answer! Meanwhile, anybody else can jump in with another offer.
So Realtors are fed up and don't want to show these listings anymore. Therefore, they are not selling. So that means there will be another huge wave, no make that an avalanche, no make that a tsunami of foreclosures coming down the road in 2010. And I don't think they will work off all that inventory until at least 2011.
Nobody at NAR will admit this! Ignore their wimpy predictions!
678 points
BoxCar answered one year ago …
We "short sold" a home in an exclusive neighborhood in Ft.Wayne, IN in Feb'08,
Our realtor was "miffed" to say the least at dealing with the banks resolution team..
Bank lost 25K on the deal that almost fell thru because of slow response to the bid.
So I agree with EthanR only normal levels will not return in my lifetime because we
all go over the edge of the 2nd Great Depression in 2012 when blackouts startup.
Read < www.dieoff.com/synopsis.htm where it staes "no renewable energy system
even has the potential to generate even a tiny fraction of the power now being
generated by fossile fuels" The only viable solution is what France has- NUKES
106 points
solesurvivor answered one year ago …
With the rate things are going, we are far from seeing the end of the foreclosure crisis, there are more and more homes being foreclosed each day and this could last until the end of next year. What a bummer. But it is good that there are government measures that provide solutions or alternatives to the problem. I ran across an article that showed how the government is dealing with the crisis which i'd like to share:
http://new.housingassistancenetwork.com/posts/view/how-the-government-is-d ealing-with-the-housing-crisis
