Foreclosures.com Reports Foreclosure Rates Rising around Country Numbers up in Western markets, Northeast and Midwest
RISMEDIA, June 27, 2006—ForeclosureS.com, a California-based real estate investment advisory firm and publisher of foreclosure property information, reported today that foreclosure activity in several housing markets was jumping.
Western Markets
"As of June 22, Los Angeles County was reporting over 14,000 notices of default and more than 700 properties have actually gone to foreclosure," said ForeclosureS.com president Alexis McGee. She went on to say that in Denver, CO and Phoenix, AZ, foreclosure activity was also rising sharply. "In the Phoenix area, the ratio of new notices of default to actual foreclosures is almost ten to one and in Denver, the ratio is more than three to one," said Ms. McGee.
She pointed to the proliferation of high risk mortgages, combined with rising interest rates as primary factors in the surge of defaults. "Interest only loans and so-called option adjustable rate mortgages with very low initial rates and high negative amortization are financial time bombs. When these loans reset to full amortization and market rates, the payment shock to homeowners is severe."
She cited a recent report by Dr. Christopher Cagan an economist with First American Real Estate Solutions in which Cagan said that a homeowner paying $800 per month on an option adjustable mortgage could see their payment jump to $3000 per month when the loan resets. "You don't have to be a rocket scientist to see that that household is going to be in distress," said Ms. McGee.
She also pointed to the fact that housing markets in both Phoenix, AZ and Las Vegas, NV had been invaded by out of state speculators. "In 2004 and 2005, in both of those markets, more than 25% of sales were made to out of state investors. Now, as rates rise and those markets cool, the speculators who came late to the party are being washed out of the market." She added that prices had gotten "completely out of whack" with rents and investors, finding themselves trapped by negative cash flows and slowing sales volume, had no choice but to walk away from their properties.
ForeclosureS.com has been analyzing markets, providing foreclosure lists and learning program and assisting investors since 1992. The company recently developed a new investor oriented foreclosure property listing system and extended their services nationwide in late 2005, covering more than 944 counties across the U.S.
NEW: ForeclosureS.com has current foreclosure statistics by state, county and foreclosure notice type available for media use. For information on how to access this information please email: alexis@foreclosures.com.
"Our objective at ForeclosureS.com," said Ms. McGee, "has always been to provide much more than just foreclosure lists. We offer both free and fee-based comprehensive learning programs for both new and experienced real estate investors."
"Our programs include a free monthly e-zine 'The Foreclosure Forecast' with 10 years worth of articles available online; Nationwide Webinar Conference Calls; a complete Foreclosure Investing home study program: and intensive Hands on Workshops that put our students out in the field with me and my Coaches to do the actual work of a foreclosure property investor."
She added that her firm has also built a cadre of successful investor clients in order to provide Personal Coaching one on one guidance to recent program graduates.
In the Midwest, Foreclosure Activity Up
ForeclosureS.com also reported today that foreclosures are still rising in several Midwestern housing markets.
"As we near the end of the second quarter of 2006, Cook County is reporting almost 20,000 foreclosures and pre-foreclosure filings," said ForeclosureS.com president Alexis McGee. She went on to say that the ratio or pre-foreclosure filings to actual foreclosures was almost two to one. "That's indicative of a trend," McGee pointed out, adding, "In some of the peripheral counties that make up the Chicago metro area, the ratio is even higher. We're seeing a major shakeout there."
McGee said that, while Midwestern housing markets never got as severely overvalued as the overheated bi-coastal markets -- homeowners were finding themselves in financial distress because of rising interest rates, slowing home sales volume, and flattening of the price appreciation curve. While the increase in the default rate is occurring across the country, the timeframe varies.
In Indianapolis, for example, the shakeout occurred during the first quarter of the year, McGee said. "The Indianapolis metro area, in fact, led the whole country at the end of Q1 in terms of the percentage of households in foreclosure at 1.45%, or one of every 69 households. Indianapolis is a much smaller metro than Chicago, but the impact on the community was severe."
ForeclosureS.com has been analyzing markets, providing foreclosure lists and learning program and assisting investors since 1992. The company recently developed a new investor oriented foreclosure property listing system and extended their services nationwide in late 2005, covering more than 944 counties across the U.S.
NEW: ForeclosureS.com has current foreclosure statistics by state, county and foreclosure notice type available for media use. For information on how to access this information e-mail: alexis@foreclosures.com
"Our objective at ForeclosureS.com," said Ms. McGee, "has always been to provide much more than just foreclosure lists. We offer both free and fee-based comprehensive learning programs for both new and experienced real estate investors."
"Our programs include a free monthly e-zine 'The Foreclosure Forecast' with 10 years worth of articles available online; Nationwide Webinar Conference Calls; a complete Foreclosure Investing home study program: and intensive Hands on Workshops that put our students out in the field with me and my Coaches to do the actual work of a foreclosure property investor."
She added that her firm has also built a cadre of successful investor clients in order to provide Personal Coaching one on one guidance to recent program graduates.
Ms. McGee has spent her whole professional life in real estate -- beginning with her studies from Arizona State University in 1983 in Real Estate Finance, then as a successful commercial real estate agent, on to personal investing in 1986, and finally as a national investment trainer since 1992.
"With foreclosure activity on the increase across the country," said Ms. McGee, "there are a lot of sharks out there that only want to virtually steal the property in foreclosure from the distressed homeowner."
"ForeclosureS.com on the other hand, teaches our investor clients to create win-win scenarios that benefit both the troubled homeowner and the investor. We show the homeowner how to save some equity for a new start. That's far better than seeing them lose everything in an auction on the courthouse steps."
ForeclosureS.com: Defaults on the Rise in Northeast after First Quarter Dip
It was also reported today that mortgage defaults were on the rise in previously overheated northeastern markets.
"In the first quarter of the year, we saw a slowdown in foreclosure activity in the Northeast," said ForeclosureS.com president Alexis McGee. "But as we near the end of the second quarter both foreclosures and pending foreclosures are up." Ms. McGee went on to say that, in Massachusetts almost 5,000 properties were in some stage of foreclosure and over 2800 had actually gone to public sale.
She added, "Foreclosure activity in the northern New England states is still negligible, but in Massachusetts, particularly around the Boston metro area, we had a very overheated market for some time. That's no longer the case. Prices have been absolutely flat there for at least three months."
Ms. McGee pointed out that her research had always seen a correlation between increases in defaults and flattening price appreciation.
"Too many homeowners," said Ms. McGee, "have been using their homes as ATM machines during the price run-up of recent years. Now, home prices have gone flat, the refinance option is closed out, and interest rates are rising back to normal levels. People with risky exotic mortgages and high consumer debt will have nowhere to turn."
Ms. McGee also reported second quarter default increases in Queens and Kings counties in the New York City metro area. "There have been over 2800 recent lis pendens filings in Queens, and almost 3000 filings in Kings County. You have to remember that New York is a city of renters with only about 25% of households being owner occupied," said Ms. McGee, "and the greatest percentage of owner occupied properties are in those two boroughs."
ForeclosureS.com has been analyzing markets, providing foreclosure lists and learning program and assisting investors since 1992. The company recently developed a new investor oriented foreclosure property listing system and extended their services nationwide in late 2005, covering more than 944 counties across the U.S.
NEW: ForeclosureS.com has current foreclosure statistics by state, county and foreclosure notice type available for media use. For information on how to access this information please email: alexis@foreclosures.com.
"Our objective at ForeclosureS.com," said Ms. McGee, "has always been to provide much more than just foreclosure lists. We offer both free and fee-based comprehensive learning programs for both new and experienced real estate investors."
"Our programs include a free monthly e-zine 'The Foreclosure Forecast' with 10 years worth of articles available online; Nationwide Webinar Conference Calls; a complete Foreclosure Investing home study program: and intensive Hands on Workshops that put our students out in the field with me and my Coaches to do the actual work of a foreclosure property investor." |
