Foreclosures have slowed, But the Lull is just Temporary

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Real Estate Agent with RE/MAX Professionals, CT 203-206-0754 REB.0759001

The inventory of distressed properties in the system is going to get higher within the next few months, according to an article I read an article in the paper this past week. Home foreclosure filings slowed in October for a third straight month, but because of the rising unemployment, the next year will see another record year for failing mortgages.

According to RealtyTrac, foreclosure filings, including notices of default and bank repossessions dropped 3% in October from the previous month, but were up 19% from the previous year. Although foreclosure filings are off of the record high hit in July of 2009, with federal efforts intensifying to press lenders to alter terms for struggling borrowers, the chief problem lies with unemployment, which is at a 26 year high.

It is projected that there will be as many as 3.4 million homes that will get a foreclosure notice this year, which is almost double the number from last year. If the unemployment situation doesn't improve, the numbers for 2011 will be similar. Couple this with the next wave of resets to adjustable rate mortgages, and our industry is in for a wild ride.

 

As buyers are already wary of making a purchase commitment because of the situation in the jobs market, with the volume of distressed properties increasing, it may cause a stall in the system that no amount of stimulus money will be able to move. The next few months will be a barometer to the 2010 market, especially when the retailers disclose their numbers from the holiday buying season.

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Ed Silva  RE/MAX Professionals,  www.edwardsilva.com  203-206-0754

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Harry F. D'Elia
Precision Real Estate Inc. - Phoenix, AZ
Investor , Mentor, CSSN, Radio Coach, REOs, ABR

I believe we have another wave of foreclosures coming in the next few months. Hold on for the ride

Nov 18, 2009 07:55 AM #1
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Valerie Osterhoudt
Johnson Real Estate, Inc. - Cromwell, CT
ABR, Cromwell, CT Real Estate ~ 860.883.8889

Ed.. I've read this too, but I have optimism that regardless of foreclosures, we will continue to see people ready to buy and sell.  I'm trying hard this year to keep up my New Years Resolution of staying positive.  Negativity, just breeds negativity.

valerie osterhoudt

Nov 18, 2009 04:58 PM #2
Rainmaker
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Al & Peggy Cunningham Brokers, Brampton Ontario Homes For Sale 905-450-5500
RE/MAX Realty Services Inc. - Brampton, ON

Oh Ed, this is a dismal report...not sure what to expect.  Right we are switching from a Buyers market to a Sellers market. There are very few listings, our office is way way down in listings.  As our real estate market went through a little whirlwind, we heard reports that maybe that isn't the case in the manufacturing sector.  We'll have to wait and see.  

Nov 18, 2009 06:53 PM #3
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Ed Silva
RE/MAX Professionals, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

Harry, I agree with you completely. We're not out of the sub-prime mess as yet with the 3-5 year ARM's ready to reset, and more people getting into trouble with their mortgages because of work cutbacks and lay-offs.

Valerie, I'm not trying to be doom and gloom, but our state has historically lagged when ever there was an economic downturn and upswing. Couple that with the fact that our state population is an aging group with young people leaving to find jobs elsewhere because they can't afford to live here independently.

Al & Peggy, good for you, we're still working on 14-16 months of inventory with the highest unemployment rate in 26 years.  I just took the CDPE class because the last few listing meetings I went to had the owners underwater or jobless. That is not a positive outlook.

Nov 18, 2009 07:41 PM #4
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