Housing Foreclosures Fall, But Is The Dip A Real One?
January 18th, 2012 categories: Chicago Real Estate News
Housing foreclosures fall, but is the dip a real one?
Housing foreclosures dropped to a four-year low last year. But that doesn’t mean that the number of homeowners in danger of losing their condominiums and single-family homes is tapering off.
Rather, financial institutions and banks last year were holding off on many of the foreclosures on their books thanks to confusion over legal issues, according to a recent feature story by the Associated Press.
According to the story, about 1.9 million homes entered the foreclosure process in 2011. That’s the lowest number of foreclosure proceedings in a year since 2007, according to numbers from online foreclosure company RealtyTrac.com.
RealtyTrac was quick to point out, though, that the lower foreclosure numbers don’t necessarily mean that the housing market is improving. RealtyTrac instead credited much of the foreclosure slowdown to banks working through documentation and legal issues that slowed their pace of clearing the foreclosures on their books.
RealtyTrac officials told the Associated Press that because of this, they expect the number of housing foreclosures to rise again in 2012.
In a bit of good news, though, RealtyTrac officials did tell the Associated Press that they think the number of foreclosures in 2012, while higher than in 2011, will be lower then the peak the country experienced in 2010.
Everyone in the real estate business, and everyone trying to sell homes, is waiting for the foreclosure rate in the country to truly fall. That’s because foreclosures tend to lower the value of all real estate for sale. You can see this in Chicago. Just check out the housing prices in an area dotted with too many housing foreclosures. You’ll see that housing prices in the entire area will have taken a fall.
There’s a reason for this: Smart buyers won’t pay top dollar for a Chicago condo or single-family home if they can spend 10-20% less to buy a similar, but foreclosed, home just a block or two away.
If you are facing a foreclosure crisis of your own, be sure to call your mortgage lender as soon as possible. This isn’t an easy call to make, but a lender might be able to work out a payment plan that allows you to keep your home and preserve your credit score.
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