Foreclosure Filings in U.S. May Jump 20% From Record 2010 as Crisis Peaks

[marmar]

By Dan Levy and Prashant Gopal


Jan. 13 (Bloomberg) -- The number of U.S. homes receiving a foreclosure filing will climb about 20 percent in 2011, reaching a peak for the housing crisis, as unemployment remains high and banks resume seizures after a slowdown, RealtyTrac Inc. said.

“We will peak in foreclosures and probably bottom out in pricing, and that’s what we need to do in order to begin the recovery,” Rick Sharga, RealtyTrac’s senior vice president, said in an interview at Bloomberg headquarters in New York. “But it’s probably not going to feel good in the process.”

A record 2.87 million properties got notices of default, auction or repossession in 2010, a 2 percent gain from a year earlier, the Irvine, California-based data seller said today in a report. The number climbed even after a plunge in filings in the last part of the year -- including a 26 percent drop in December -- as lenders came under scrutiny for their practices.

Foreclosures have weighed down U.S. housing prices as the nation’s unemployment rate is stuck at more than 9 percent. Home values may rise 0.6 percent for the year, the first annual jump since 2006, according to Fannie Mae, the largest U.S. mortgage buyer. They have fallen as much as 33 percent since peaking in 2006, based on the S&P/Case-Shiller Index of 20 cities. ...........(more)

The complete piece is at: http://noir.bloomberg.com/apps/news?pid=20601087&sid=au6WoHUjHrAo&pos=5

[Ezlivin]

1. Recovery: Pure fiction

We are not going to return to the halcyon days of house-flipping and instant-no-money-down mortgages that fueled an insane building frenzy.

If they think that the recovery will look like a return to days of yore, they're sadly mistaken. Those days are forever gone.

[G. Odoreida]

2. How I hope you are right

But every time I hear a politician talk about "we need recovery in the housing market" I get worried that the helium tanks are gonna get uncapped again.

We crammed about two and a half decades of housing inflation into the years 2002-2007, aided and abetted by both political parties. This means that with -normal- growth in housing prices, many areas will not return to bubble price levels until perhaps 2025-2030. Nor should they....

[Hosnon]

3. Hopefully those days never come back - they were clearly unsustainable.

This is good news. The housing market needs to bottom out. We're in a deflationary spiral right now... potential home-buyers are not entering the market because prices keep falling. Once they bottom out, home-buying will pick up.

On a somewhat related note, something should be done about student loan debt. A good portion of the young people in this country already have a "mortgage payment" and can't afford another one.

[tomm2thumbs]

4. Nevada: 1 in every 11 households received foreclosure filing

sobering

One in every 17 Arizona households got a foreclosure filing last year, while one in 18 received a notice in Florida.