Posts Tagged ‘foreclosures in Arizona’

On the Brink of a New Housing Crisis? Foreclosure at Record High for Second Month

June 24, 2010

This beautiful Scottsdale home is a current bank-owned foreclosure. Interested in purchasing a home like this? Call the Curtis Johnson team!

The second plunge of the real estate market is beginning to rear its ugly head. For 2 months in a row, April and May, bank repossessions have hit a record monthly high. Nearly 94,000 properties in the United States were repossessed in May alone. Arizona foreclosures are the second highest in the nation. These numbers are an increase of 44 percent over a year ago.

These are not newly distressed properties, and many have been sitting empty for months—abandoned by their financially troubled owners—but the fact that these REO homes will soon cram the real estate listings is the real problem. When normal listings are placed side by side with bank owned repo’s the only way they can compete is by dropping their prices. If you are in no rush to sell your home, that’s probably not too troubling, but if you’re heading towards foreclosure yourself, or even just being relocated for your job, then you want a quick efficient sale. If your price can’t meet those of other homes, chances are that sale will be slow in coming.

Sure, Bob and Mary could walk into your home and immediately fall in love, realizing it’s the dream home they have always wanted, and after a little bit of haggling about the sales price you could be packing for your big move—but in reality this is a pretty rare event these days. You may have to drop the price of your home by $20,000 or more just to get some interested buyers, with offers coming in well below that.

What this means is that all homes will have their prices driven down again, more and more homes will go into foreclosure as financially distressed home owners are unable to sell them, relocated homeowners will be forced to rent out their home in order to carry two housing payments, and distressed neighborhoods could continue to become more and more blighted.

I’m afraid that the government’s attempt to salvage some of the housing market in the past has only increased the problem now. The Home Buyer Tax Credit kicked the market into action, but since it has stopped so has the market. Slow home buying activity combined with an increase in bank repossessions is combining for what will soon be a very unpleasant situation.

Want to get your home sold quickly before the market plunges deeply? Contact the Curtis Johnson team to learn more about our Quick Cash Options. Looking to invest? It’s an investor’s dream right now and we have many properties to suit you. Call the Curtis Johnson team today!

Go to CurtisJohnsonRealty.com or call 1-888-Curtis-J.

What Do Current Foreclosure Numbers Suggest for the Economic Future of Arizona and the Nation?

May 24, 2010

The foreclosure crisis is still with us—and it is pulling down whatever economic recovery we may have seen. The number of bank owned properties, and the actual repossessions in the last quarter, is at an all-time high. As more and more foreclosures hit the market, it drags down the overall value of homes. And when house prices drop, as we have seen in recent years, the economy drops with it.

After all, why would someone want to pay $50,000 more for house A, a regular listing, than for house B, a foreclosure? If both homes are in good condition and everything else is equal, it’s pretty much a no-brainer. The very presence of house B will force the owner of house A to drop the price just to get an offer.

According to the Mortgage Bankers Association, the number of homes in the foreclosure process was at 4.63%, an increase of 5 points over the previous quarter and up an astonishing 78 basis points from a year ago. Homes considered to be in the foreclosure process do not include simple delinquencies.

The news is not all bad though. According to the same figures, the number of homeowners beginning to be in trouble with their mortgages has declined since the last quarter and compared to a year ago.

According to RealtyTrac, Arizona moved up to 2nd place nation-wide on the list of states with the highest number of foreclosures, however the actual number of foreclosures in Arizona has dropped significantly. The spike in place was due primarily to a much larger drop in California’s foreclosure rates. Still, the number of foreclosures in Arizona is nearly double that of the nation.

Another disturbing trend is the type of mortgages going into default. While the earlier problem-mortgages were the high-risk subprime variety, today’s foreclosures are more likely to be on mortgages that were not considered to be a significant risk.

Add to the economic mix the sharp decline in mortgage applications over the past few weeks since the Home Buyer Tax Credit ended. Potential home purchases, after a surge in the fall and winter months, are now at a 13-year low.

While it is still hotly debated whether the economic improvement in recent months is a temporary spike or a long-term upward trend, there is no denying that the housing crisis is far from over. The next few quarters will show us a more realistic picture of what the economy will do, with the housing market leading the way.

Whether you are looking to buy a home or facing a troubling mortgage situation, give the Curtis Johnson team a call. The Curtis Johnson Team is helping individuals who are facing foreclosure and those who are seeking their dream homes.

Go to www.CurtisJohnson.com or call 1-888-Curtis-J.