| By :
Frank Patrick
A New Downturn Could Create More Foreclosures Than Ever Before. Robert Reich, former Secretary of Labor under President Clinton, recently suggested that a new double-dip recession may be on the way. The reason? New employment figures are still dismal, the median wage continues to drop and middle class consumers lack the disposal income to spend. And there’s plenty of evidence that the housing market will be experiencing an increased amount of REO foreclosures, on top of the already massive number that are already on the market. Although experts were hoping that foreclosures were finally stabilizing, the April, 2010 numbers were not good. For every home loan situation that’s improving, two are getting worse – with a total of over 7 million distressed loans currently held by banks. Delinquency and foreclosure rates are still higher than last year, and the total foreclosure inventory is still up over 20% year-to-year. Moreover, the value of foreclosed properties held by US banks hit $41½ billion in the first quarter of 2010, a 12.4% increase from the previous quarter, according to SNL Financial, a data analysis firm. Currently, according to financial firm Morgan Stanley, it would take 47 months to clear the REO homes “shadow inventory” being held by banks. And that does not take into account new foreclosures. Looking more closely into the future, Capital Economics projects that there will be 5.5 million REO properties on the market by the end of 2011. “To put that in perspective, that’s more than the 4m homes currently up for sale,” said the Capital Economics team. “Without a doubling in demand, a doubling of supply would deter homebuilders from constructing new homes and put more downward pressure on prices.” Finally, in another sign of the times, Freddie Mac is, for the first time in its history, looking for REO listings agents and brokers. Sharon Barlett, the manager of supplier operations, revealed that more than 350 brokers interviewed for positions in 16 states as well as the District of Columbia. In addition, Freddie Mac also conducted interviews with potential vendors. Listing brokers represent Freddie Mac in its REO property disposition, listing properties for sale and maintaining the houses during the process. More and more REO professionals will continue to be in demand to handle these specialized property transactions in the months to come, as they have been since the housing bubble first burst a few years ago. Already REO properties are in great demand because of the great value they present to the average homebuyer. Training to become an REO agent and learning how to get REO listings will be an excellent career choice as joblessness continues to plague the country.
|
![[Valid RSS feed]](http://www.articlesbacklink.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
