Why will banks release these properties in the near future?
Because there is an additional wave of foreclosures coming right on their heels. Just yesterday, Freddie Mac in their Fourth Quarter and Full-Year 2009 Financial Results Report stated:
…the housing recovery remains fragile, with significant downside risk posed by high unemployment and a potential large wave of foreclosures.
Where will this new wave of foreclosures come from?
Homes where the owner is currently 90+ days behind in their mortgage payments. A recent study by Amherst Securities stated that once a borrower falls at least 90 days behind on their mortgage payment there is less than a one percent chance they will ever catch up. 99% of these homes will end up as a distressed property (foreclosure or short sale).
How will your state be impacted?
Below is a graph compiled from data from the Mortgage Bankers’ Association 2009 4th Quarter National Delinquency Survey. The graph shows the affect in all 50 states and the District of Columbia.
Click the Pic to Enlarge the Chart
The blue lines represent the current foreclosure inventory in each state as of the end of 2009. The red line represents the number of homes currently at least 90 days behind on their mortgage. Remember, 99% of the red lines will eventually turn blue.
There will be a ‘wave of foreclosures’ coming to the market in 2010. The inventory that they currently have and the inventory they are about to get.
What does this mean to you?
If you are thinking of selling your home, do it now. The theory of supply and demand dictates that the value of your house is greater now than it will be later in the year.
