Unexpected Cities See More Homes Go Back to the Bank
Yes, the four states that we always talk about are still leading the nation in foreclosure rates. Okay, Florida, California, Arizona, Nevada...if you've been trapped under something heavy for the past few years. But for the past few months a new trend is emerging, and some numbers released today really put it into perspective.
Foreclosure "actions" in Q3, which include anything from default notices to bank repossessions, rose in 65 percent of the nation's top 200 housing markets.
In Seattle, they jumped 71 percent, in Chicago up 35 percent and big double-digit jumps in Houston and Atlanta too.
These are not cities that saw enormous price jumps during the housing boom (maybe Seattle, but not the others) and they definitely did not see the kind of investor activity that the fab four saw during housing's heyday.
Not in the general release, but in a little side-bar that Realty Tracsent me, you see really big jumps in bank repossessions, which are the final stage of foreclosure when the bank takes the house back and evicts you. Quarter to quarter, Seattle saw a 65 percent jump, Philadelphia a 38 percent jump, Boise, ID up 71 percent and even Richmond, VA taking a 28 percent leap. One word: Unemployment.
Of course the logical question next is, what happens to home prices in those cities, as foreclosures hit the for-sale inventory.
Sure, there are buyers out there looking for deals, but with the foreclosure robo-mess hanging over the market, some sales frozen, some not, there's not a whole lot of buyer confidence out there to take the leap into the "distressed" market.
That just means the prices on those homes have to go lower.
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