Archive for November, 2008

Foreclosure Trends

Saturday, November 29th, 2008

According to Yahoo News Real Estate the top foreclosure cities in the country are currently:

1.  Merced, California

2.  Modesto, California

3.  Stockton, California

4.  Riverside, California

5.  Detroit, Michigan

6.  Fort Lauderdale, Florida

7.  Cape Coral, Florida

8.  Vallejo, California

9.  Las Vegas, Nevada

10. Sacramento, California

Even though foreclosure filings are down in the Los Angeles area, the fact that 6 of the top 10 foreclosure cities in the country are in California, does not bode well for a turnaround any time soon in that state. The rapid escalation of prices in Fort Lauderdale, Cape Coral and Las Vegas during the mid-2000s explains their prominence on the list right now. 

The devastation that high foreclosure rates have on a community are very apparent every time I visit Cape Coral where every block has a house or two in foreclosure. Some neighborhoods have had to put up with half built abandoned buildings that serve as eyesores.  Prices of land have fallen by about 90%. Prices of homes have fallen by half or more.  There were signs earlier in the year that prices had fallen to the point were people were willing to buy again. Still, there is a common believe that even in this devastated market prices have not fallen as far as they must in order to attract people back to the community.

In my native Iowa there were 4,203 foreclosures posted in September 2008 for an annual total of 35,773. There were 56 foreclosure homes sold in Iowa in September for an annual total of 796.  The year to date average foreclosure sale price was $79,553.  Iowa has just started to see layoffs.  The floods last summer also affected businesses and people lost jobs and homes because of that.  My guess is a lot of the existing are in communities that saw a lot of flood damage like Cedar Rapids, Palo and some neighborhoods in Des Moines. Many were too disheartened to try to clean up and salvage their homes and they picked up and left. Still, compared to the cities listed above, the cities in Iowa seem pretty insolated from the worst of the foreclosure news.

Liz Nichols

 

 

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Reasons to Be Thankful

Friday, November 28th, 2008

I watched the Barbara Walters interview with Barack Obama Wednesday night.  He seems to be having a positive influence, so far, on the financial markets thanks to some astute selections for his financial team, and an advance look at the policies he wants to put in place soon after his is inaugurated.  I’m thankful for the strengthened market and hope that it continues to show some strength.

I’m thankful that the rate of foreclosures seems to have slowed in some of the states that have been hit hardest, and particularly in California.  But will this be permanent, or are we gearing up for another round because of the weakening economy?

I’m thankful that a number of financial institutions seem to be better prepared to negotiate with homeowners for a solution short of foreclosure.  In a recent news article, the head of lending for Wells Fargo said that a year ago only about 8% of homeowners were contacting lenders before default.  Now lenders are being proactive at contacting homeowners and offering options before things get too far out of control. It still takes work to outline the hardship and come up with the documentation that a bank needs to approve a workout plan or a short sale, but the willingness to listen is the first important step homeowners need.

These are all small steps in the right direction of what is still going to be a long haul.

Liz Nichols

 

 

 

 

 

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