I don’t think the banks mind if inventory is kept off the market. It keeps prices artificially low and prices higer.
Published: Thursday, 11 Oct 2012 | 8:43 AM ET
In another sign that the still shaky housing recovery might be finding its footing, foreclosure filings in some of the hardest hit states of the housing crash have plummeted dramatically, and overall the nation is seeing the lowest level of foreclosure activity since 2007.
Foreclosure filings, which include notices of default, scheduled auctions and bank repossessions, were reported on 531,576 U.S. properties during the third quarter of this year, according to RealtyTrac, a foreclosure sales and data website.
That is a decrease of 5 percent from the second quarter and a decrease of 13 percent from the third quarter of 2011. One in every 248 U.S. housing units with a foreclosure filing during the quarter.
“We’ve been waiting for the other foreclosure shoe to drop since late 2010, when questionable foreclosure practices slowed activity to a crawl in many areas, but that other shoe is instead being carefully lowered to the floor and therefore making little noise in the housing market — at least at a national level,” said Daren Blomquist, vice president at RealtyTrac. “Make no mistake, however, the other shoe is dropping quite loudly in certain states, primarily those where foreclosure activity was held back the most last year.
There is fast becoming a large divide in foreclosure activity between states that require a judge in the foreclosure process and those that don’t. The latter, which include formerly hard-hit states like California, Michigan and Arizona, are non-judicial, and foreclosures there have cleared the process faster. In states like New York, Florida, New Jersey, Ohio, and Illinois, where a judge is required, the picture is still bleak.
Foreclosure activity jumped on a year-over-year basis in 14 out of the 26 judicial foreclosure states. New Jersey saw a 130 percent increase, New York a 53 percent jump and Pennsylvania a 35 percent increase. This will make it harder for overall home prices to improve in those states, as distressed home sales bring values down.
It is a far different story in California, where overall foreclosure numbers are still high, but are down 45 percent from a year ago, according to RealtyTrac. Eager investors, as in Arizona, are standing ready to buy distressed properties, but they are finding little supply, and that is putting upward pressure on prices at the low end.
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Proprietary OC Housing News home purchase analysis
$399,000 …….. Asking Price
$394,000 ………. Purchase Price
8/7/2008 ………. Purchase Date
$5,000 ………. Gross Gain (Loss)
($31,520) ………… Commissions and Costs at 8%
($26,520) ………. Net Gain (Loss)
1.3% ………. Gross Percent Change
-6.7% ………. Net Percent Change
0.3% ………… Annual Appreciation
Cost of Home Ownership
$399,000 …….. Asking Price
$13,965 ………… 3.5% Down FHA Financing
3.40% …………. Mortgage Interest Rate
30 ……………… Number of Years
$385,035 …….. Mortgage
$118,918 ………. Income Requirement
$1,708 ………… Monthly Mortgage Payment
$346 ………… Property Tax at 1.04%
$259 ………… Mello Roos & Special Taxes
$100 ………… Homeowners Insurance at 0.3%
$401 ………… Private Mortgage Insurance
$259 ………… Homeowners Association Fees
$3,072 ………. Monthly Cash Outlays
($251) ………. Tax Savings
($617) ………. Equity Hidden in Payment
$15 ………….. Lost Income to Down Payment
$70 ………….. Maintenance and Replacement Reserves
$2,289 ………. Monthly Cost of Ownership
Cash Acquisition Demands
$5,490 ………… Furnishing and Move In at 1% + $1,500
$5,490 ………… Closing Costs at 1% + $1,500
$3,850 ………… Interest Points
$13,965 ………… Down Payment
$28,795 ………. Total Cash Costs
$35,000 ………. Emergency Cash Reserves
$63,795 ………. Total Savings Needed
The property above is available for sale on the MLS.Contact us for a comparative market analysis, a cost of ownership analysis, or information on how you can make an offer today!
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