Realty Partner Real Estate P i Prices See S Dramatic Drop Nationwide for 2011
™Real Estate prices in the US have double dipped nationwide nationwide, now lower than their March 2009 trough, according to a new report p from Clear Capital. p ™It was inevitable, and it was predicted ((by y me for sure)) that a surge g in sales of foreclosed real estate and a big push by banks to facilitate short sales would force h home prices i down d dramatically. d ti ll
™Sales of bank-owned (REO) properties hit 34 5 percent of the market, 34.5 market according to the survey, resulting in a national price drop p of 4.9 p percent q quarterly y and 5 percent year-over-year. prices have fallen 11.5 ™National home p percent in the past nine months, a rate not seen since 2008. Add short sales, where h the th bank b k allows ll th the b borrower to t sell for less than the value of the mortgage , and prices have nowhere to go but down.
™"With more than one-third of national homes for sale being REO (bank owned), owned) market prices are being weighed down as many y markets have not regained g enough g footing to withstand the strain of the high proportion of REO sales," says Clear Capital's Alex Villacorta.
™You don't have to tell Los Angeles Realtor Bill Kerbox any of this this. LA prices had been improving, and LA is still one of the nation's best-performing p g metro markets right now. ™ Recently, however, prices took a turn, now down 2.4 percent quarter to quarter thanks to 34 percent REO saturation.
™"We have definitely seen a number of both short sales and foreclosed real estate along the West Side here, and they y have definitely y taken a hit," , bemoans Kerbox. ™"It hurts to have a very low comp pop up next to your beautiful new home."
™While the usual subprime mortgage suspects like California, suspects, California Arizona, Arizona Florida and Nevada used to rule the foreclosure roost and still have high g volumes of distressed properties, the mid-west is seeing a surge in REOs now, thanks to the plain old recession.
™40 percent of the Chicago realty market is foreclosures, foreclosures 43 percent in Cleveland and 51 percent in Minneapolis. ™Home prices fell 8.7 percent in the MidWest during the past three months compared to the previous quarter.
™While the foreclosure crisis is abating on the front end end, with fewer loans going newly delinquent, the pipeline of seriously y delinquent q loans is enormous. ™Banks are now ramping up the foreclosure p process after the "robosigning" paperwork scandal, but at their current pace it would take about four years to t process all ll the th b bad d loans l through foreclosure and even longer to sell those homes for sale out on the open market.
™While buyer demand is rising, thanks to a slowly improving jobs picture, picture mortgage availability is still very difficult for the low to middle-income borrower,, and falling g prices don't help already weak consumer confidence in the housing market.
™If prices continue to fall further, which they likely will in the short term, term the number of so-called "underwater" borrowers,, those with negative g equity, q y, will rise even higher, which could in turn result in more loan delinquencies. ™http://www.realtypartner.com