Wall Streets foreclosure crisis, which began in late 2007 and forced more than 10 million people from their homes, has created a paradoxical problem. Millions of evicted Americans need a safe place to live, even as millions of vacant, bank-owned houses are blighting neighborhoods and spurring a rise in crime. Lucky for us, Wall Street has devised a solution: Its going to rent these foreclosed houses back to us. In the process, its devised a new form of securitization that could cause this whole plan to blow up—again.
via Mother Jones.
A fantastic article that anyone concerned abot real estate and the housing markets should read. - Tim Ballering
From 2009-2012, the top 1% of Americans captured 95% of income gains. Now, as the housing market rebounds, billions of dollars in recovered housing wealth are flowing straight to Wall Street instead of to families and communities. Since spring 2012, just at the time when Blackstone began buying foreclosed homes in bulk, an estimated $88 billion of housing wealth accumulation has gone straight to banks or institutional investors as a result of their residential property holdings, according to an analysis by Tom Dispatch. And it’s a number that’s likely to just keep growing.
via naked capitalism.
FNC said rising home sales accompanied by a relatively low share of foreclosure re-sales are the key drivers of continued increases in home prices. As of September, foreclosure sales nationwide accounted for 13.4% of total home sales, up slightly from Augusts 12.7% but down from 16.6% a year ago.
When home prices were heading downward banks would sometimes send default notices to homeowners but allow them to stay in the home without making payments if the homeowner would maintain the home and keep it in good condition. Now that the economy is improving and home prices are rising, banks are willing to complete the foreclosure process if homeowners dont start making their payments again.”
All four measures of distress in the housing market dropped to post-crash lows during the third quarter of 2013 the Mortgage Bankers Association (MBA) said today. The national delinquency rate, serious delinquencies, loans in foreclosure, and foreclosure starts all registered significant declines during the quarter.
Richmond’s problem isn’t simply – or even primarily – that so many homeowners are underwater.
Richmond’s problem is that it has high unemployment, stagnant incomes, high poverty, high housing vacancy rates and a large share of homeowners with a crushing mortgage burden.
The Obama administration is examining ways to pull foreclosed properties off the market and rent them to help stabilize the housing market, according to people familiar with the matter.
In many parts of the United States buying a foreclosure is en vogue. Buyers flock to these properties because they are allegedly a great deal. But, are they?