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Foreclosures drop to June levels Weichert Realtors As a result of recently enacted laws that have extended the foreclosure process in some states, more aggressive loan modification programs and foreclosure moratoriums by some lenders, foreclosure activity dropped 7 percent in November. According to RealtyTrac, an industry source for foreclosure data, this is the lowest level since June.
A decline in the number of homes in foreclosure is good news for real estate and the overall economy:
Sellers benefit because there are fewer homes on the market. This should make it easier and less costly for them to sell their home.
Foreclosures exert downward pressure on median home values, so home prices should rebound as the number of foreclosed properties on the market decreases.
Loans could become easier to get. Banks lose money on foreclosed properties, leaving them with less money to lend.
As it becomes easier to sell homes, move-up buyers set in motion a chain of homebuying and selling. Each home sale triggers a demand for goods and services through all segments of the economy.
The recent RealtyTrac report, coupled with the government's ongoing efforts to enact programs that will modify even more loans moving forward, is encouraging news for the coming year.
Posted: December 16, 2008
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