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Foreclosures spiked 36% over July numbers and are more than double the number over the same period last year according to the most recent RealtyTrac report. Nevada and California lead the nation (shocker) and the number of repos is up as well. From a Market Watch interview with the CEO of RealtyTrac:
“The jump in foreclosure filings this month might be the beginning of the next wave of increased foreclosure activity, as a large number of subprime adjustable-rate loans are beginning to reset,” said James Saccacio, chief executive for RealtyTrac.
Last month’s leveling off, which some tried to cite as a break in the chaos were clearly wrong. The foreclosure rate in July was up just 9% over June, which some housing bulls pointed to as a sign that the worst was behind us. As you probably learned in one of your math or science classes - one data point does not make a trend. It is clear that the foreclosure train is in full speed barreling down (and off?) the tracks. Hold on.
One down side to our industry is all the smoke and mirror games that go on. That last 6 years have been a so called field of dreams “build it and they will come” well guess what? They are not coming. The only thing that has truly gone up in the last 5 years has been the cost of living. Look and the cost of milk, cheese and gas compared to the salaries of the past five years. With out the sub prime and the alternate financing , especially stated income loans how are they realistically going to sell down all the inventory. I have said for years that home prices were out of control. When I purchase my home in Virginia for 190,000 back in 2001, That was a lot of money for me and my wife back then and we made over 100,000 per year. Now that same home is listing for 360,000. We had that home built from the ground up, and there is no way that home is worth it. There are homes that have been on the market for 9 to 12 months is our community. We brought in the 1st phase and there is still inventory from the 4th phase just sitting. I feel sorry for the people who brought at the height of the boom, But the market needs correction in pricing of homes and some people will be upside down in there home for a while. At the height of the boom I was doing Va and Fha loans only and I seen first hand how the bubble priced some of my clients right out of the market and me out of a job. I later went to work for a sub prime lender and now I run my own brokerage.
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