NEW YORK (CNNMoney) -- There is a growing glut of foreclosed homes threatening to hit the market over the next couple of years, potentially delaying any recovery.
There were 1.7 million homes either owned by the bank or in some stage of foreclosure at the end of the third quarter of 2010, according to a recent report by Standard & Poor's. It would take 44 months, at the current rate of sales, to sell them off -- a 25% increase from the beginning of 2010. (S&P does not count home loans backed by Fannie Mae and Freddie Mac.)…
next, my commentary…
The paragraph above, in and of itself is troubling…but when you look at the statement within the parentheses, it becomes horrifying! The most recent statistic that I’ve read estimates in excess of 65% of all loans as being backed by Fannie or Freddie…and this S & P report just decides to leave that out? I have been telling my clients for a year or more that this distressed inventory backlog will continue to drag home values down for several more years…coupled with no real plan or prospects for meaningful job and income growth, and the market looks very, very soft to me.
The following is from the recent Mortgage Bankers Association Delinquency Report, and will be a real eye-opener:
- Number of properties that are 30 or more days delinquent or in foreclosure: (A+B loans) 6,870,000 !
Big difference from the widely published news story in CNNMoney…over 5 million more at least 30 days past due or further along in the foreclosure process.
And Numero Uno on the list of states with highest percentage of non-current loans…you guessed it: FLORIDA
So, 44 months to sell off 1.7M (and this doesn’t count all of the “non-distressed” homes on the market)…so how many months to sell off 6.8M? Well, using my middle school math, I came up with 176 months of inventory…That’s over 14 years!
Not to beat a dead horse, but if you are thinking of selling, even (especially) if you owe more than your home is worth…lets talk about your options, market direction, etc. Call me directly at 561-602-1258. If I don’t answer, please leave me a message
