Last month I attended a conference in Austin, Texas. It was a privileged to be on the guest list because it was limited to only 200 REALTORS from around the country that hold a CDPE Certification. There are presently 26,000 of us certified out of 1.5 million Realtors so this is why it was an honor to be included. The topic was short sales, foreclosures and distressed home owners. I would love to say it was a fun time but, it was actually unnerving.
In a presentation from Bank of America it was stated that they are processing 60,000 short sales a month and 1 out of 7 home owners are presently behind in their mortgage and headed towards foreclosure. Others are requesting loan modifications and forbearances which far exceed the number of short sale requests they receive daily. Most loan modifications are turned down and end up in foreclosure or short sale. The banks are drowning in paper and losses while they struggle to keep their head above water.
What is Happening With All of The Banks?
Collectively banks are sitting on 5 million foreclosures that have not re-entered the market for two reasons. One they can’t get to them and two if they released them all at once we would have a total meltdown when home values drop 50% over night. The banks do not want to foreclosure. They lose on average 70% on a foreclosure compared to 40% on a short sale.
How Does This Affect Triangle Homeowners?
Homeowners in the Raleigh, Cary and Triangle areas are getting more and more distressed with the longer days on market and economical conditions that continue to worsen. The word at the conference is the market is not expected to hit bottom and start improving for 3 to 10 years depending on the state. It can’t improve until the number of distressed properties stop pouring in. To give you an example 4 years ago Bank of America processed 100 short sales per month. 100 then, compared to 60,000 now, is a radical difference.
What Do You Think, Linda?
I personally believe the Triangle area of North Carolina is are a 3 year state in a price range of $500,000 and below and a 5 year state if the price range is over $500,000. I would love to be wrong and see it rebound today! By the way, the 3 day conference was not all doom and gloom information. It was advanced training on how to save families and neighborhoods from foreclosure. I have attended two of these conferences this year and have a webinar every week with the CDPE organization to stay on top of this quickly changing market.
What Do I Do If I Have More Questions or Need Help?
There are three quick ways to receive information. First, you can visit my Raleigh Area Short Sale and Foreclosure Resource Website , or visit my Raleigh Real Estate Website’s Short Sale Information Center or you can just simply call me at 919-235-0007.