The share prices of the banks may have recovered, but the underlying rot remains.
According to RealtyTrac’s U.S. foreclosure market report, in the first quarter of 2009, 803,489 properties or one in every 159 housing units received a foreclosure filing, including default notices, auction sale notices and bank repossessions.
“In the month of March we saw a record level of foreclosure activity — the number of households that received a foreclosure filing was more than 12 percent higher than the next highest month on record,” said James J. Saccacio, chief executive officer of RealtyTrac, in a press release. “Since much of this activity was in new foreclosure actions, it suggests that many lenders and servicers were holding off on executing foreclosures due to industry moratoria and legislative delays.”
Saccacio also noted that the temporary drop in foreclosure activity had more to do with processing delays than foreclosure prevention programs.
“It’s very likely that we’ll see the number of REOs increase again now that most of the moratoria have been lifted,” Saccacio said.
Of course, the actual condition of some of these foreclosures is another matter entirely. Here’s a story on that estimates as many as 30% of bank owned properties are seriously damaged.
From CNN By Drew Griffin and David Fitzpatrick entitled: Experts: Some foreclosed homes too damaged to sell
“The economy in southern New Hampshire is not by any means among the worst in the nation. Still, according to city records, there are 29 foreclosed homes on the books in Nashua — many of which are in deplorable condition.
“This house is not livable right now,” Nelson Ortega, the city’s chief building code inspector, told CNN as he stood in front of a boarded-up single-family home on a residential street in Nashua.
The foundation of the house was fractured, Ortega said, and there were cracks and fissures in many of the supporting beams. At the side entrance to the house were broken windows, garbage and peeling paint.
In 2006, Ortega said, the property sold for $200,000. It’s anyone’s guess, he said, what price the home might bring now, if it ever sold.
That this foreclosed home might not ever sell was not news to a researcher who lives nearby.
“About a third of all of the foreclosed properties nationwide have been so damaged, either by the previous owners or by criminal gangs coming in after the foreclosure, that they no longer qualify for standard mortgage financing,” Thomas Popik told CNN. “So there is going to be all kinds of government programs to help, but if they don’t qualify for standard mortgage financing, there’s no one to buy these properties.”
Popik says responses from thousands of real estate agents nationwide to the questionnaires he sends out quarterly indicate that badly damaged foreclosed homes — so-called “distressed” properties in real estate jargon — are a much bigger element of the national housing picture than officials in Washington have acknowledged.”
The housing bubble rolls on….
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