Posts (RSS)Home Sales Down, Foreclosures by State Up
Home sales continue to slide as foreclosures by state continue to rise. Home sellers who are hoping they would increase their sales during the selling season of March to June are concerned about the continued rise in foreclosures by state despite the foreclosure moratorium and despite the launching of President Obama’s economic stimulus program.
According to housing analysts, about 19 million homes across the country are unoccupied, contributing to the rise in foreclosures by state. This figure translates to almost 1 unit out of seven homes, the highest ratio ever recorded since the 1960s. Since only about 6 million homes are listed for rent or for sale, home tracking firms expect more foreclosed homes to add to the market already overloaded with bargain homes.
Foreclosures by state are expected to rise further as reports show that 1 in nine mortgages is defaulting and going into foreclosure and existing-home sales in January are declining at the fastest rate since 2007.
In California, which is among the top three in rankings of foreclosures by state, home prices have declined so much that first-time homebuyers and investors who previously were not able to buy homes are now able to buy.
Christian Punsal, an Elk Grove city employee in his early 20s, has purchased a three-bedroom house for only $193,000. His monthly payment for this unit, which cost $336,000 when he was still in college, is even $100 less than his current rent at his smaller apartment.
In Florida, another state among the top in listings of foreclosures by state, many of the unoccupied foreclosures houses are in suburbs. This means that prices will take time in recovering and many not get back to their previous price levels in many years as many suburban residents have moved to downtown areas to look for jobs.
Even in New York, which is not even among the top ten in rankings of foreclosures by state, sales of condos and co-op apartments in January have also declined by 52 percent. According to Jonathan Miller, head of appraisal firm Miller Samuel, the housing market has been severely affected by Wall Street layoffs, stricter lending requirements and a surplus of new apartments and unoccupied previously-owned homes.
Ivy Zelman, head of housing research company Zelman & Associates, is concerned about April, the month when home sales traditionally start to rise. He expects more foreclosures to enter the market as mortgage firms end their voluntary moratoriums on foreclosures.