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Tuesday, July 27, 2010
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Foreclosure numbers staying about same as '09
Senior Reporter Area foreclosure numbers don't appear to be dropping with any significance after the first six months of the year.
The number of foreclosures in Crow Wing County between January and June is just three shy of the number posted for the first half of 2009.
Foreclosure facts
Sheriff's Certificates indicate how many foreclosures were recorded in Crow Wing County in the last five years.
2006 - 142
2007 - 231
2008 - 356
2009 - 351
2010 - 174 as of June.
Source: Crow Wing County Recorder's office.
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The 174 foreclosures for the first six months of this year have already surpassed all of those in 2006. The number of foreclosures rose steeply during the recession, more than doubling between 2006 and 2008.
In 2006, the first six months of the year saw 59 foreclosures. The following year, the number for that same time period jumped to 108. By 2008, there were 186 foreclosures between January and June. For 2009, there was a decrease in foreclosures for the first half of the year, but the numbers picked up a bit by year's end to nearly mirror 2008's totals.
Now the question is what kind of second half will come this year.
Notices of pendency, which indicate a foreclosure is likely, provide a glimpse of things to come. In 2008, there were 576 notices and 356 foreclosures. Not every notice turns into a foreclosure with more effort going into keeping struggling families in their homes, but the number of notices indicates how many homeowners are on the edge.
In the first six months of 2006, there were 135 notices. That number more than doubled to 291 for the same time period in 2008 and jumped to 331 for the same time period in 2009. Between January and June this year, there were 281 notices of pendency.
Looking at the year totals, there were 273 notices of pendency in 2006, 427 in 2007, 576 in 2008 and 644 in 2009.
In the lakes area, properties that would have been snapped up quickly before the housing market collapse now remain on the market for extended periods as people continue to worry about jobs, financial security and face much tighter credit.
Nationally, short sales - where lenders let homeowners sell homes for less than they own on mortgages - are increasing. Locally, there are frequent notices of area real estate agents who are now certified in short sales.
The Associated Press reported Monday that despite years of falling prices, homes are expected to lose still more value in many metro areas during the next year, including Minneapolis. The AP reported that is the conclusion of economists who have been reducing estimates for home prices.
"The number of homes for sale or headed for foreclosure is so high that they think prices will be even lower by next July," The AP reported. "Because housing is such an important engine of the economy, lower prices could dim the recovery.
When home values fall and people have less equity, they tend to cut back on spending. And as prices decline, potential homebuyers stay on the sidelines, slowing sales even more.
"Earlier this year, analysts said they thought home prices had finally reached their low point and were ready to start rising slowly in most areas of the country. Now, they think the actual bottom could be nearly a year away."
The forecast is less optimistic than it was this spring when the call was for home prices that didn't rise or fall.
"The average home price in the Standard & Poor's Case-Shiller index of 20 big U.S. cities is forecast to drop nearly 2 percent this year from a year earlier, according to the average estimate of more than 100 economists polled this month by MacroMarkets LLC," The AP reported. "Other, more bearish analysts think prices will sink 10 percent or more."
Moody'a Analytics predict Minneapolis, among other metro areas like New York, Los Angeles, Denver, Tampa Fla., Washington D.C. and San Diego, may see home value declines of 2 to 8 percent by next July.
Edina Realty recently reported Grater Lakes Association of Realtors Multiple Listing Service numbers show closed home sales in the Brainerd lakes area were 6 percent higher in June 2010 compared to the same period last year. Edina Realty reported the average home sales price also rose 7 percent and the average sales price for the Brainerd area is now $197,746, compared to $183,962 a year ago.
"Edina Realty experts attribute the increased activity to repeat or move-up home buyers," the real estate company reported. "These home buyers, who are purchasing homes priced over $250,000, are taking advantage of low mortgage rates and a healthy inventory of homes for sale. In June, move-up buyers represented approximately 31 percent of all Edina Realty's pending home sales, compared to just two months ago when move-up buyers represented 23 percent of pending home sales."
RENEE RICHARDSON may be reached at renee.richardson@brainerddispatch.com or 855-5852.
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