Get Out Your Umbrella, There's a Foreclosure Storm Brewing
Posted by Lee Cameron on Tuesday, March 2nd, 2010 at 1:19pm.
Our real estate market has been showing some life signs in recent months but the sun isn't shining brightly yet. There are dark clouds on the horizon that will likely mean more rough times ahead.
Many reports indicate that a large amount of foreclosures are about to flood the market and bring prices down again. For various reasons, many properties have not yet reached the foreclosure stage but will be soon. Mortgage services and courts across the country have been overwhelmed and slow to push through the foreclosure process. Meanwhile, many homeowners have fallen behind on their payments due to unemployment and other factors.
Though government aid programs have managed to slow the increase in mortgage debt, the numbers are still rising every month. As it stands, just counting the homeowners who have fallen badly behind on their payments and the current foreclosures on the market, estimates say that it will take three years to sell off the inventory at the current pace. And that's not even counting the thousands of homes that are likely to go into foreclosure in the next year.
These not-yet-foreclosed homes are often called the "shadow inventory" and some experts believe it could equal as much as half of the entire current market of homes for sale. When these homes finally go on the market, well...that's when the storm will hit. Keep those umbrellas handy.
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