Reports show an increase in the supply of foreclosed homes.
• 645,800 foreclosed homes in January
• 617,286 foreclosed homes in December
• For the month of April and estimated 733,000 foreclosed homes as expected to go on the market.
• After April listing foreclosed property listings are expected to decrease.
• 8 million households are delinquent on their loans.
• S&P/Case-Shiller national index predicts that there will be another 6% drop in home price before stabilizing at the end of the year.
Last year not as many foreclosed homes were part of the banks inventories due to the extraneous process of loan modification that was keeping homeowners in their homes longer. Most of the homeowners did not qualify for the government program and were foreclosed upon. Those are the homes that are listed on the market today.
Unemployment rates are the highest contributing factor in the housing market as well as underwater mortgages. The “American dream” and belief of keeping your home is not as strong or much of a tradition it used to be. People are not afraid of walking away from their homes. The question that lies beneath their decision is “Why should I pay more than what I owe?”
Some lenders will realize that this is the question on most of their consumers’ minds. If they are smart they will help modify the loans or agree to a short sale. This way they will not have to foreclose on another property that will be sold for much less than what the original owner was willing to pay.
Contributor, designer & admin for JohnHart Gazette.
