Foreclosures Last Year
Realtytrac recently published its market report covering the foreclosure market for the past year. The report showed that there were 3,825,637 foreclosure filings in 2010. According to the report, this represented a 23% increase over 2008 and a 2% increase over 2009. The top foreclosure cities, according to the report were; Las Vegas, Chicago, Phoenix, Miami and L.A. Some similar numbers were covered in our January 7th posting.
A vice president with Realtytrac explains that there is a difference in the current foreclosure market. He explains that most foreclosures used to be a result of “toxic” loans. He said that today, there are many more “plain vanilla” loans that are foreclosing because people are “not getting a paycheck.” He said that for every 6-10 jobs lost, there is one resulting foreclosure. As a result, the homeownership rate has dropped considerably.
Washington Spending
Our previous post about China actually plays into the chances that we will experience a housing recovery. If the federal government continues on its spending spree, it will not have the ability to pay off its (our) debt. If this happens, the result can be increased interest rates. The housing recovery, whenever it begins to happen on a large scale, will be greatly hampered by an increase in interest rates.
The federal debt is now over $14 trillion. How many generations of Americans will be straddled with this? A housing recovery and an increase in employment are needed to stave off more of the economic gloom that has been a part of the landscape the past few years.
The Economy on a Fence
Some of these numbers have caught the attention of Wall Street in recent days with the market reacting in a negative fashion after a 25% rally in recent months. Many large companies will report earnings in the week ahead. This is just one more component, along with mortgages, foreclosures, new unemployment claims, home values and a half dozen other indicators of what’s to come. Stay tuned.
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