About Me 0060: foreclosure statistics

I've been following the Sacramento market to see the change in mix over time (conventional, REOs, and short sales) in a distressed area. The Sacramento Association of REALTORS® started breaking out REOs in May 2008, and short sales in June 2009.

I'm not exactly sure what I'm looking for, but hopefully I'll know it when I see it! As some point, the number (and percent) of distressed sales will start to decline without foreclosure moratoria, homebuyer tax credits or other distortions. There is no sign of a decline yet (except seasonal).

The percent of distressed sales in Sacramento declined slightly in June compared to May because of a seasonal pickup in conventional sales. In June 2011, 65.2% of all resales (single family homes and condos) were distressed sales. This is down from 65.6% in May, and up from 62.4% in June 2010.

Here are the statistics.

Click on graph for larger image in graph gallery.

This graph shows the percent of REO, short sales and conventional sales. There is a seasonal pattern for conventional sales (strong in the spring and summer), and distressed sales happen all year - so the percentage of distressed sales decreases every summer.

Notes: Prior to June 2009, it is unclear if short sales were included as REO or as "conventional" - or some of both. The tax credits might have also boosted conventional sales in 2009 and early 2010.

MR. DORSEY: Mr. President, 6 percent of our questions are coming in about housing, which you can see in the graph behind me. And this one in particular has to do with personal debt and housing: “How will admin work to help underwater homeowners who aren’t behind in payments but are trapped in homes they can’t sell?” From Robin.

THE PRESIDENT: This is a great question. And remember, I mentioned one of our biggest challenges during the course of the last two and a half years has been dealing with a huge burst of the housing bubble.

What’s happened is a lot of folks are underwater, meaning their home values went down so steeply and so rapidly that now their mortgage, the amount they owe, is a lot more than the assessed worth of their home. And that obviously burdens a lot of folks. It means if they’re selling, they’ve got to sell at a massive loss that they can’t afford. It means that they don’t feel like they have any assets because the single biggest asset of most Americans is their home.

So what we’ve been trying to do is to work with the issuers of the mortgages, the banks or the service companies, to convince them to work with homeowners who are paying, trying to do the right thing, trying to stay in their homes, to see if they can modify the loans so that their payments are lower, and in some cases, maybe even modify their principal, so that they don’t feel burdened by these huge debts and feel tempted to walk away from homes that actually they love and where they’re raising their families.

We’ve made some progress. We have, through the programs that we set up here, have probably seen several million home modifications either directly because we had control of the loan process, or because the private sector followed suit. But it’s not enough. And so we’re going back to the drawing board, talking to banks, try to put some pressure on them to work with people who have mortgages to see if we can make further adjustments, modify loans more quickly, and also see if there may be circumstances where reducing principal is appropriate [...]

MR. DORSEY: So we have a follow-up question to your answer about homeowners being underwater. And this one came in under 10 minutes ago from Shnaps: “Is free-market an option? Obama on homeowners underwater: have made some progress, but plus needed looking at options.”

THE PRESIDENT: Well, when Shnaps — (laughter) — when Shnaps talks about free market options, I mean, keep in mind that most of this is going to be a function of the market slowly improving because people start having more confidence in the economy; more people decide, you know what, the housing market has kind of bottomed out, now is the time to buy. They start buying. That starts slowly lifting up prices, and you get a virtuous cycle going on.

So a lot of this is going to be determined by how well the overall economy does: Do people feel more confident about jobs? Do they feel more confident that they’re going to be able to make their mortgage? And given the size of the housing market, no federal program is going to be able to solve the housing problem. Most of this is going to be free market.

The one thing that we can do it make sure that for homeowners who have been responsible, didn’t buy more house than they could afford, had some tough luck because they happened to buy at the top of the market, can afford to continue to pay for that house, can afford their current mortgage, but need some relief, given the drop in value — that we try to match them up with bankers so that each side ends up winning. The banker says, you know, I’m going to be better off than if this house is foreclosed upon and I have to sell it at a fire sale. The mortgage owner is able to stay in their home, but still pay what’s owed.

And I think that that kind of adjustment and negotiation process is tough. It’s difficult partly because a lot of banks these days don’t hold mortgages. They were all sold to Wall Street and were sliced and diced in these complex financial transactions. So sorting through who owns what can be very complicated. And as you know, some of the banks didn’t do a very good job on filing some of their papers on these foreclosure actions, and so there’s been litigation around that.

But the bottom line is we should be able to make some progress on helping some people, understanding that some folks just bought more home than they could afford and probably they’re going to be better off renting.

on line reputation management

About Me 0060

Wednesday 3 August 2011

foreclosure statistics

CBS <b>News</b> Executives Speak Out on License Fees, Dan Rather at TCA <b>...</b>

<b>News</b> attacks — Crooked Timber

Language Log » <b>News</b> Flash: BBC Admits Error

No comments:

Post a Comment