Foreclosures Blog – Foreclosure Listings Nationwide

Falling foreclosed property prices in the Tristate have been cutting down home appraisal values and have been hindering some mortgage loan applications.

While the low level of foreclosed property prices in the Tristate have been attracting large numbers of investors and first-time home buyers who have cash to spend, the lower home appraisals have been a barrier to some buyers who could not qualify for the loan-to-value ratios required by the lenders.

One homeowner in West Chester has been selling her house for $107,000, but the buyer who is ready with an FHA loan could not complete the purchase because the home appraisal was only $80,000. The seller said the appraisal is $8,000 lower than her current mortgage loan and $3,000 lower than the tax appraisal conducted by a Butler County assessor in 2008.

The appraiser said he based his appraisal on recent house sales in the area, which have been sold at foreclosed property price levels.

Another homeowner in Butler County has been selling his home for $105,000, but another house, about the same in size and look just several doors away, is being sold at $70,000. So it can be assumed that the $105,000-priced house will take a longer time to sell, especially if there are many foreclosed property units nearby priced at around $70,000.

Another homeowner in West Chester has found a buyer for his home listed at $126,000, but the buyer could not carry out the purchase because the home appraisal was only $100,000. The buyer said he is still trying to find some ways to come up with the $26,000 needed to cover the gap.

Large foreclosed property inventories have pushed down the prices of homes in many states. In April, home prices went down by more than 18 percent, based on the Standard & Poor’s/Case-Shiller 20-City Home Price Index released this week.

A top Barclays Capital economist had predicted home prices to go down further by a staggering 40 percent next year. A private equity fund executive claimed that hundreds of thousands of bank owned repossessed properties will be released to the market in the coming months. These factors will push down further home prices nationwide.

In May, Ohio was tenth among states with the biggest foreclosure rates. One house in every 446 housing units in the state was hit with a foreclosure action. Out of 11,360 homes which received foreclosure filings, more than 4,000 units were already scheduled for foreclosure sales while more than 3,000 units were already in foreclosed property listings.

Related Posts:

• Low Appraisals Contribute to Rise in Foreclosure Homes
• Foreclosure List Prices in Santa Cruz, California Still Down
• Foreclosed Properties Cut Santa Clara Value Growth
• Assessing a Foreclosure Listing
• FHFA Announces New Plan to Combat Foreclosures due to Inflated Appraisals

The large number of low-priced foreclosed properties in Santa Clara, California has cut down the growth of property values in the county as of January 1, 2009, based on a report released by the county this week.

Total assessed property values in Santa Clara grew by only 0.18 percent compared to last year, the smallest growth rate since 1978.

The total assessment was $303.9 billion, marking an increase of only $542 million compared to last year.

County officials said the low prices and high volumes of foreclosed properties contributed to the drop in the total assessed value. They pointed out that when foreclosed properties are sold, the selling prices are often much lower than the previously assessed values.

Countywide, foreclosed properties soared four times to 6,200 units in 2009, compared to the total in 2008.

David Ginsborg, county deputy assessor, said that about 90,000 houses out of the total 400,000 houses in the county lost value this year largely because of the large volumes of foreclosed properties. He said the average value loss for each house was about $170,000, pushing the total net value loss to $17.4 billion.

Larry Stone, the county assessor of Santa Clara, explained that assessed values in the county incorporate market conditions.

Additionally, Ginsborg said that the county is responding appropriately to the declining market values of real estate properties. He said that the county also suffered a drop in assessed value growth in 2007. That year, total assessed value fell by 8.25 percent, a drop from the 9-percent growth rate in 2006. Last year, value growth was 7 percent.

Ginsborg expects assessed value growth to further decline next year because of the continued increase in foreclosures. The expected drop in commercial real estate values will also cut down assessed values further.

When a consumer buys a home in Santa Clara, the buying price is the assessed value, according to Ginsborg. Every year after the purchase, the county assessor adds only 2 percent or less to the home’s assessed value.

The cities which bucked the countywide declining trend are Mountain View, where assessed values rose by 6.2 percent; Los Altos, by 4.3 percent; Los Altos Hill, by 2.9 percent and Palo Alto, by 3.8 percent.

The deputy assessor explained that the four cities had more established communities and had lesser number of entry-level houses and foreclosed properties.

Related Posts:

• Foreclosure List Prices in Santa Cruz, California Still Down
• More Condos, Townhomes in South Florida Foreclosure Listings
• Funding to Renovate Properties on Bank Foreclosure List
• Foreclosed Home Listing Sales Rose in Southern California
• NABE Sees Recovery from Foreclosed Homes List Inventories

More than half of total home sales in Grand Rapids, Michigan in June were foreclosed home listing sales or short sales, based on real estate sales data in Michigan.

Out of the 1,081 houses sold in June, 53 percent were foreclosed home listing properties or homes sold through short sales.

Additionally, more than 25 percent of total homes sold in June were priced below $50,000. In June 2007, only seven percent of total homes sold were priced below $50,000.

The low level of foreclosed home listing prices has pushed down the average home price in Grand Rapids to $113,923, a 13-percent decline from the average price in June 2008. The June drop however is much less than each of the annual drops in the first 5 months of 2009, which ranged from 17 percent to 29 percent.

Real estate analysts in the area said they are hopeful the slowdown in the pace of price decline is a positive signal, in addition to the decreasing number of days a foreclosed residential property stays in a foreclosed home listing.

They said home inventory in the area have dropped from 13 months to about ten months worth of inventory.

However, housing analysts are concerned about expectations for more foreclosed home listing properties in the coming months, as discussed in a recent report issued by the Treasury Department.

Some brokers in the area said that banks have told them they are going to release large volumes of foreclosed properties in the third and fourth quarters.

Michigan is among the ten U.S. states most clobbered by foreclosures. In May, it is sixth in charts of state foreclosure rates, with one house in every 326 housing units hit with a foreclosure action. Out of nearly 14,000 foreclosure filings in May, 6,246 properties were already in foreclosure listings while the rest were already for trustee sales.

This week, the Obama administration has expanded its Making Home Affordable program to help more troubled homeowners, especially those with underwater mortgages, but many homeowners now doubt the effectiveness of the new provision of the program.

Many homeowners have been complaining that their lenders have not been responding to their applications for modification and refinancing despite connecting with certified counselors.

Because of barriers to the Obama administration’s foreclosure prevention program, housing analysts contend that more houses will be added to foreclosed home listing inventories in the coming months.

Related Posts:

• Foreclosed Home Listing Sales Rose in Southern California
• Home Sales Dropping, But Officials in Kalamazoo Michigan Optimistic
• Low-Priced Foreclosed Home Listing Affects Home Prices
• Foreclosed Home Listing Prices in Midwestern Cities Down
• Funding to Renovate Properties on Bank Foreclosure List

Veteran and novice homebuyers know that they can have homes at big discounts from lists of bank foreclosures. But some homeowners in Detroit, Michigan still could not afford to buy their dream houses because of the difficulty of stretching their small mortgages.

Default rates on prime loans have increased in the first quarter, escalating the number of houses added to foreclosed home for sale inventories.

The number of townhouses and condos for sale in South Florida has remained relatively high despite the rise in sales of homes in foreclosure listings and other residential listings in the region.

Over 50 refinancing and mortgage modification companies are currently under investigation as part of Arizona Attorney General Terry Goddard office’s crackdown on fraudulent repo home listing rescue services that have been victimizing unsuspecting homeowners who are desperate to save their homes from foreclosures.

Foreclosed home listing prices in the Midwest maintained their affordable levels last month, based on a study of residential real estate prices in the Midwest in May.

Among the reasons given for the continued rise in number of foreclosed properties are unemployment, subprime lending, adjustable-rate lending and difficult family circumstances such as divorce or hospitalization.
Another major reason is negative equity – home value is less than loan amount. Borrowers who have negative equity, sometimes known as underwater borrowers, often decide to walk [...]

Senators Claire McCaskill, Jack Reed, Chris Dodd, Joe Lieberman and 16 other senators wrote Treasury Secretary Timothy Geithner to urge him to look into the barriers slowing down the foreclosed housing prevention program. The senators also expressed their concern about the impending readjustment of ARMs.