Foreclosure rates are increasing in the United States as house prices continue to decline. Really, this ought to make house buyers happy. However, those seeking to sell a home might want to wait just a little longer.
Drop shown in FHFA report
The Federal Housing Finance Agency states this week that its home-price index fell in the current quarter quicker than at any time since 2008. Prices have fallen 2.5 percent in the last quarter, which is a drop of 5.5 percent from last year. Only homes covered by Fannie Mae or Freddie Macwere in the report. Cash only sales are also not in the list.
Issues brought on by foreclosures
FHFA acting director Edward DeMarco said, “In many local real estate markets, particularly those hit hard by this cycle, foreclosures and other distressed properties are still a key factor in recorded and anticipated future sales and may be delaying price stability or recovery.” There has been a decrease in the price people are willing to pay for foreclosures. It has been going down significantly, RealtyTrac explained. During the first quarter, the average sale price was $168,321 which dropped 1.46 percent from a year ago and 1.89 percent from the quarter before. Foreclosures end up lowering house values in the whole neighborhood. The rest of the index ends up affected by the foreclosures.
Third parties not as involved in foreclosure process
“While foreclosure sales continue to account for an unusually high percentage of all residential home sales, sales volume is well off the peak we saw in the first quarter of 2009, when nearly 350,000 foreclosure properties were sold to third parties,” reported James Saccacio, the CEO of RealtyTrac. There was a 16 percent drop from the last quarter and 36 percent go down from a year ago in the number of homes sold to 3rd parties which was at 158,434 in the first quarter.
How the states differ in foreclosure
Every state has a different number of homes being foreclosed on. Both Ohio and Illinois had the same. It was 41 percent for both. A 45 percent rate was shown in California and Arizona. It was really bad in Nevada. About 53 percent of the industry accounted for foreclosures.
Possible foreclosure scams to look at out for
A lot more foreclosure scams have come about. They are sometimes hard to see. Some corporations promise to protect from foreclosure for an upfront fee. The homeowners end up with nothing. Mortgage reduction plan negotiations can’t have upfront fees anymore with a requirement made in February with the Federal Trade Commission.
Citations
Wall Street Journal
blogs.wsj.com/marketbeat/2011/05/25/home-prices-fall-at-fastest-pace-since-late-2008/?mod=google_news_blog
DS News
dsnews.com/articles/home-prices-post-biggest-drop-in-two-years-as-foreclosures-depress-market-2011-05-26
DS News
dsnews.com/articles/home-prices-post-biggest-drop-in-two-years-as-foreclosures-depress-market-2011-05-26
Daily Finance
dailyfinance.com/2011/05/27/foreclosure-prices-fall-again-how-your-state-stacks-up/
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