FORECLOSURES: THE REAL NUMBERS FOR REO PROS

Some quick updates on the housing market.

First, RealtyTrac, a foreclosure sale site, recently put out their numbers for May, showing that foreclosure filings fell 6 percent from April. But the real story is that REO foreclosures are up 18 percent from last year.

Not only that, but foreclosures in May numbered over 300,000 – they were the third highest ever – and it was the third straight month of over 300,000 foreclosure filings as well. If you were to actually add up REO foreclosures from March, April and May of this year, you’d see that there are already one million properties that are in the foreclosure process.

That indicates that, despite any “good news” you hear about the housing market stabilizing, it’s just not true. Right now, foreclosures are a runaway freight train and REO listings are going to continue to mushroom.

Second, the other “good news” that was recently reported was a 17% rise in new housing starts in May from April. Again, what’s not reported widely was that there was a 49% decline in multi-family units the month before. Some builders are beginning to get back into action – but even then, 50% of these homes that are just beginning construction are being built “on spec” – which means the interested homeowners won’t commit until the homes are finished.

The builders are also rushing to get new homes up in order to beat the expiration of the $8000 first time home buyers’ tax credit, which vanishes at the end of November of this year. Unfortunately, the rise in mortgage rates has already put a damper on this brief flurry of activity.

Finally, the 10 cities with the most homeowner vacancy rates – a sure sign of high REO activity - are Minneapolis, Detroit, Springfield MA, Sacramento, Cincinnati, Atlanta, Tulsa, Riverside CA, Las Vegas, Greensboro NC…and Orlando, FL coming in at #1.

Make sure and stop at www.ASREOS.com, the home of the first trade organization for REO agents, brokers and contractors founded by REO experts, for all the latest on the REO industry, as well as lots of exclusive features specifically created to help the REO pro succeed.