Obama-Romney Debate ‘Ignores’ U.S. Housing And Foreclosure Problems

With all the spirited banter last night about tax cuts, 47 percenters, foreign policy, job creation and all-things political, it appears the Barack Obama and Mitt Romney “ignored” perhaps one of the biggest economic issues facing the United States during their second presidential debate at Hofstra University:


There are countless pointed reactions and passionate thoughts about “who won” the debate. And depending on which news channel you watch or in which political direction you lean, you’re going to get a mixed bag of reactions and have formulated your own opinions. That’s cool — we’re not here to pick sides, not even close, but shed light on a glaring omission. Housing is a serious issue and it has been since the mortgage meltdown more than a half-decade ago that triggered the national foreclosure crisis.

So why aren’t the 2012 presidential candidates talking more about it?

Zachary Goldfarb of the Washington Post provides a potential explanation that splits party lines rather evenly:

“Both Republicans and Democrats agree that one way to help the economy would be to launch a massive program to allow Americans to refinance their home loans at low rates. Obama has suggested such a proposal, as has a top adviser to Romney. Yet neither Obama nor Romney has an incentive to discuss housing. Housing has been arguably one of Obama’s weakest areas as president; he has acknowledged it was the most stubborn problem he faced. And Romney’s approach has been largely to allow the free market to sort out the woes of the housing market, allowing those who got in over their heads to default. Neither is a popular talking point.”

Perhaps unpopular, but certainly worth debating when the dynamic duo hit Lynn University in Boca Raton, Fla., next week for their third and final verbal sparring session prior to the election on Nov. 6, 2012. A fine institution of higher learning nestled in the heart of South Florida, one of the hardest-hit foreclosure hot beds in the nation.

To read Obama’s policy on housing click here and to read Romney’s click here.

Photo by VOA [Public domain], via Wikimedia Commons

Top 10 Most Searched Foreclosure Cities In The U.S.

Where are all the foreclosures?

Well, in today’s market, foreclosed homes are located in just about every corner of the United States. Long gone are the days when distressed real estate was hard-to-find, valuable treasure. Make no mistake, foreclosures, short sales and other distressed property types are typically still cheaper than their traditional counterparts; however, thanks to the mortgage meltdown a few years back and the current nationwide economic crisis, they are significantly more abundant.

In fact, there are so many foreclosures in some “hot spots” that banks and lenders don’t have the time or resources to repossess them in a timely fashion. That’s the reason some folks can live in their homes mortgage-free for months or even years, as well as the reason for the “shadow” inventory — abandoned/vacant homes not yet “in the system” — that sits idle for so long.

Indeed, foreclosures are essentially everywhere. And until the lenders and banks catch up, or until the economy levels out, or both, foreclosures will continue to remain everywhere well into the near future.

The good news is that foreclosed homes represent discounted real estate purchase opportunities. Banks and lenders are overwhelmed and are often eager to sell their assets as quickly as possible, even if it means slashing prices by as much as 50 percent or more. Always remember: Banks and lenders are in the money business, not the real estate business.

Cash is king.

So, since we’ve established that foreclosures are everywhere and that they still offer buyers and investors tremendous value — especially when you factor in historically low mortgage interest rates — we thought that we’d take a look at the most popular areas for foreclosure searches throughout the nation.

Just because there are more foreclosures on the market and unemployment is high, doesn’t mean that competition among buyers doesn’t exist. On the contrary, competition is stiff in desirable locations nationwide. In fact, it’s common for forward-thinking investors and others to cherry-pick the best deals, renovate and rent/re-sell them for profit.

It’s the primary reason Government-Sponsored Enterprises (GSEs) like Fannie Mae have had to implement programs such as “First Look,” which locks out investors from purchasing properties for a few days so first-time buyers don’t miss out on all the great opportunities.

In any case, here are the Top 10 most-searched cities for foreclosed homes for sale*:

  1. Los Angeles, Calif.
  2. Orlando. Fla.
  3. Fort Lauderdale. Fla.
  4. Miami, Fla.
  5. Houston, Texas
  6. Atlanta, Ga.
  7. West Palm Beach, Fla.
  8. Dallas, Texas
  9. Chicago, Ill.
  10. Las Vegas, Nevada

Florida, with four cities in the list, is clearly a major point of interest for many buyers and investors. That’s not too surprising, considering the climate and reputation for being a retirement and/or vacation home destination. In addition, the “Sunshine State” took a beating when the housing market crashed — it has consistently remained at or near the top of the collective foreclosure list since it tanked.

Even still, homeowners who paid too much at the height of the market are still struggling to get their heads “above water” on mortgages that simply no longer make sense (or cents).

It’s also no surprise that Los Angeles, where the population density is high and the real estate footprint is perhaps just as dense, sits atop the list. Houston, Atlanta, Chicago and Las Vegas are also in demand, indicating that if buyers and investors are interested in investing in these areas that they better be prepared and on top of their games.

Searching and finding foreclosures is clearly a small piece of a very competitive pie in many areas throughout the United States. It’s the first, albeit perhaps most important, step in a process that could mean the difference between making (or saving) tens of — if not hundreds of — thousands of dollars.

The best thing that you can do to improve your chances of success is to do your homework, know your target market inside-out. This way, you can identify a deal the moment you see it and are able to move fast to ensure that no one else beats you to the punch.

Timing is everything even when foreclosures are everywhere.

*Foreclosure data provided by Foreclosure.com

Report: Home prices projected to begin increasing in 2013

It’s going to get worse before it gets better, but there is apparently a shimmer of light at the end of the national housing market’s long, dark tunnel.

Beginning in 2013, home prices are projected to increase a modest 1.77 percent, according to a survey conducted by MacroMarkets LLC, which is based on the S&P/Case-Shiller index over the next five years. In the foreseeable future, prices are expected to continue to decrease 2.53 percent in 2011 and .13 percent in 2012.

Overall, prices are predicted to grow on average 1.1 percent through 2015, according to the study, which surveyed 111 real estate experts and investment/market strategists, among others, to arrive at its conclusions.

Robert Shiller, MacroMarkets cofounder and Yale University professor of economics, explains the possible reasons for the slow growth:

[Read more…]

How do foreclosures affect property values?

Nasser Daneshvary, director of the Lied Institute for Real Estate Studies, explains the scientific formula that he has discovered regarding the toxic effects of foreclosures on neighborhoods in a recent sit-down with the Las Vegas Sun.

Here’s the snip:

“We know foreclosed homes sell for a discount, but what do they do to the neighborhood? We found out that the first few foreclosures have a big effect, and then five and six and seven don’t matter, and then eight, nine and 10 matter a lot. The negative effect on your value keeps declining until it reaches around 40 homes within a half a mile from you. You have lost 33 percent. More than that doesn’t matter.”

To search foreclosed homes near you and see them all on a map relative to your house click here.

Report: Distressed real estate sales continue to increase

Get ’em before they’re gone!

CNBC Real Estate Reporter Diana Olick today reports that bank-owned foreclosures (also known as REOs) and short sales — both of which fall under the distressed real estate umbrella — accounted for nearly 50 percent of all home sales in Dec. 2010.

The 47 percent share is up from 44.5 percent in Nov. 2010.

Low interest rates, as well as delayed sales agreements that were finally pushed through after “robo-signing scandal” concerns were alleviated, are the primary reasons behind the major spike.

Thomas Popik of Campbell/Inside Mortgage Finance explains:

“There were signed purchase and sale agreements, and those closings were delayed until the paperwork was reviewed. The major servicers pulled from the market houses that had been listed, and buyers were found. Once those transactions went back on, then they closed, and that’s what bumped up these December statistics so much.”

Keep in mind that home sales are typically down during the holidays, which makes this news even more remarkable because real estate business was actually up 12.3 percent (seasonally adjusted) to close 2010.

To search foreclosed homes and short sale listings for sale in your area click here.

Be sure to hurry … the distressed real estate market is fast and furious. The best deals don’t last long!