Foreclosures Up 39 Percent in 1Q

MSNBC ^ | 5/21/2006 | Liz Flaisig

[ex-Texan]

NORTHEAST FLORIDA -- The rise in foreclosures that analysts predicted would follow an easing in lending restrictions, low interest rates and creative mortgage products has emerged in metropolitan Jacksonville.

Recently released data from California-based RealtyTrac Inc. showed the five-county metro area experienced a 39 percent increase in foreclosures over last year's first quarter, or 3,579 foreclosures for the first three months of this year compared with 2,570 for the same period in 2005.

The increase was just above the national foreclosure increase of 38 percent for the first quarter, which RealtyTrac analysts said could mean foreclosures going above 1.2 million in the United States this year.

[TommyDale]

Why do I say that? The infrastructure is in desperate need of repair...the highways and roads are under construction, the traffic sucks, and the airport is a real joke.

[ex-Texan]

The Effect of a 10% Decline in Real Estate Prices

Already in some sections of Northern California, real estate prices have gone down about 12% - 15%. I posted a report on FR about Florida house flippers taking losses of $ 50k - $ 80k recently on $ 300,000 houses and condos. There are reports from Boston about people lowering their prices more that 10%.

Get ready for the roller coaster ride of the century.

[dakine]

Sold house 31 Mar...now renting...taking a wait and see attitude...but DC doesn't follow the norms...

[Triggerhippie]

Because it's not in NC.

[ex-Texan]

Smart move! Wait until the end of 2007. There will be bargains galore out there.

[Triggerhippie]

Or Savannah. (Although I'm sure Jax has its share of Lady Chablis wannabes too!)

[agrarianlady]

DC/VA had a wonderful down cycle after the '88 peak. Lots of foreclosures for the choosing.

I say, new homes for everyone!

US New Home Inventory.

4/2004..383,000
4/2005..445,000
4/2006..565,000

[TommyDale]

These statistics need to be scrutinized carefully. If prices have truly dropped, then have the assessed values also changed? Or has the AVERAGE SALE PRICE dropped? That is an entirely different thing.

[mmyers]

You are clueless about this mortgage, yes if you make the minimum payment, interest will defer. On 400,000 note the min payment is 1286, you would defer 862.00 per month which is 10,334 a year. Now what hidden broker fees are you dreaming about? Also these loans only go to 95% LTV max and the lender will not recast until 115%. These loans are NOT for everyone. However I have had one for 5 years now and love it. I also am a mortgage broker.

[stylin19a]

Sales of New Homes Jumps

People coming & people going....

[LetsRok]

That is a misconception of buyers. Foreclosures are not cheaper than regular housing. Foreclosed property will still sell for market price. You will not be bidding alone for a foreclosed property. With multiple contracts coming in, the final price will still be the same as the non-foreclosed house next door.

[Hydroshock]

Not necessarily. I think that by the beginning of 2008 we will see a redux of teh real estate market her in the Houston area we had in the late 1980's. Foreclosures were up 1000% (yes that is not a typo) and the banks were happy to dump house for whatever they could get.

[anymouse]

Take a look a the Jacksonville job market (or lack of jobs.) The bipolar economy is spreading across the country from California and the North East.

The leisure wealthy drive up the real estate and the entitlement class drives up the government's budget forcing increased taxes. Businesses rightly move away from high tax areas. The middle class gets squeezed as jobs decline, housing costs rise and taxes rise.

Usually it is the Democrats that drive this vicious circle of economic ruin, but lately RINOs have been caught up in this slow motion civic suicide. Look for the Democrats to point this out in November.

[LetsRok]

Yes, but if the houses are offered at a very low price, you will still get a bidding war of investors and that will run the final price up to where it should have been anyway.

[CDHart]

Of course they add up. The 1% payments are now expiring and it's time to pay the piper, and it's not possible for many in that situation.

Carolyn

[redgolum]

Kind of interesting in my area now. The Iowa, Illinois Quad City area is in serious decline do to jobs leaving the area like rats off of a sinking ship. If you want to buy a house and never sell, great place to do it. If you plan on moving any time in the next 5 to 10 years, don't buy a house here.

Lots of houses on the markets, lots of developments that have stopped construction. Interesting times.

[stylin19a]

the 80's bust in Houston was tied to the oil bust.
what's going on in Houston today that will cause foreclosures to be up 1000% ?

[Hydroshock]

That is not waht happened then. Some house sat ont he market for between 1 and 2 years with no takers, even at 90% of the value.

[Hydroshock]

Arms. The interest rates go up, the taxes go up, and the cost of living goes up. Foreclosures go up.

[Rte66]

There was an oil bust going on then - empty office buildings all over town, in addition to homes. The situation is not the same this time and Houston housing prices are still well below the average of other major cities.