Foreclosure rates are lower than they were a year ago in 61 of the nation's 100 largest housing markets, according to a new analysis of loan data by CoreLogic.

CoreLogic counted 1.4 million homes in the foreclosure process during February, down 7.6 percent from a year ago.

With 65,000 homes completing the foreclosure process in February, loan servicers were completing foreclosures at an annual rate of 670,000 per year. That compares to 862,000 foreclosures actually completed in the preceding 12 months.

The percentage of borrowers behind on their mortgage payments by 90 or more days fell to 7.3 percent in February, down from 7.8 percent at the same time a year ago but up slightly from the 7.2 percent seen in January 2012.

About 3.4 percent of all homes with a mortgage were in the foreclosure process, down from 3.6 percent a year ago. Approximately one-third of homes nationally are owned outright and do not have a mortgage.

The five states with the highest foreclosure rates were: Florida (12.0 percent), New Jersey (6.6 percent), Illinois (5.4 percent), Nevada (5.0 percent) and New York (4.9 percent).

The five states with the lowest foreclosure rates were: Wyoming (0.7 percent), Alaska (0.8 percent), North Dakota (0.8 percent), Nebraska (1.0 percent) and Montana (1.4 percent).

The National Association of Realtors is predicting existing-home sales will jump 7 to 10 percent in 2012 to the highest level in five years, based on an "uneven but higher sales pattern" so far this year.

Pending home sales fell a seasonally adjusted 0.5 percent from January to February, which was up 9.2 percent from the same time a year ago, NAR said today in releasing its latest Pending Home Sales Index.

Last week, NAR reported a similar trend for existing-home sales, which were down 0.9 percent from January to February, but up 8.8 percent from a year ago.

The pending sales data released today provides a glimpse into more recent trends, because it tracks homes that were under contract in February -- deals that will in most cases be finalized within one or two months.

NAR said 31 percent of Realtors experienced contract failures in February, in some cases because buyers' mortgage applications were rejected or because appraisals came in below the negotiated price.

In the Northeast, NAR's index slipped a seasonally adjusted 0.6 percent from January but was up 18.4 percent from a year ago.

Six years after the market peaked in 2006 and prices started to decline, many sellers are still in denial about the current market value of their homes. It's difficult for most sellers to accept the reality of today's home-sale market, whether they bought at or near the peak and will lose money selling today, or bought decades ago but are still stuck at 2006 prices.

An Oakland, Calif., homeowner recently remarked that she was aware that home prices had dropped quite a bit over the last five years. But she felt that her home hadn't lost any value.

It's hard for homeowners to divorce themselves emotionally from a home they've enjoyed. But this is what sellers need to do so that they can make rational decisions about a list price that will actually result in a sale.

This decision should be based on listings that have sold in your area that could be considered somewhat comparable to your home. Some sellers go to open houses to evaluate the competition. If you're still emotionally wrapped up in your home, the exercise can be futile. You return home feeling that the other homes aren't as good as yours.

The answer to the title question is maybe.  And of course that can present a problem for those who think it is and those of us that these buyers are looking to for assistance.  I have found myself telling potential clients on a regular basis that the market has shifted drastically over the past few months and in many segments this is most definitely a seller's market. 

The La Quinta area saw prices increase in 2011.  Word has gotten out (obviously not to everyone) and all the fence sitters and investors are clamoring to get a piece of the pie now that they realize that the bottom is past us.  Can anyone say with 100% certainty that the bottom is past.  Of course not.  There are many factors that can affect the market, including unforeseen national or global catastrophes.  But barring something like that, all indications are that 2012 will be another up year.  There were 384 sales in the last 3 months .  Active listing currently are 815 homes.  So at this rate we have 2.3 months of supply...

Despite the disparity in prices, the atmosphere in the market is much like it was during the peak times.  Most properties in this price range are selling with multiple offers, most above list price and many the first day.  I got two offers accepted this week, and it feels like a miracle happened.  One of those has put in more than a dozen strong offers before this one was accepted.  The other, while luckily getting the first one offered on, quickly realized that the information I supplied in our initial meeting was spot on.  Before this offer, there were a few properties that they were interested in, but never got to offer on because they were off the market in a day. Some clients have busy schedules and can't get out to look immediately.

I have another client who has also put in more than a dozen different offers only to be rejected.  One of those last week was for a property that actually received 60 (yes that is sixty) offers.  Doesn't sound like a buyers market to me.

A big issue with this type of market is that offers are competing in a small range.  Appraisals are based off closed listings, and while adjustments can be made for market conditions, they don't provide a wide berth beyond the hard statistics.  Cash buyers are ruling the day because they aren't worrying about whether the property will appraise.

The upper end of the market, price wise, isn't feeling this yet, as there is still a large amount of higher end inventory.  Still overall, we should see continuing increases this year.  Adding to the demand are people who lost their homes in the early years of the downturn who may now be eligible to get new loans.  It continues to get interesting.

Here comes Spring, historically the time of year when buyers awake from the winter slumber of the holidays and snowfall, and go on their pilgrimage to look for new housing. Houses look better in Spring with green grass, blooming trees, and flowers.

Plus, buyers who find a home in the next 60 days can close after the school year ends and enjoy the summer months in their new backyards. It’s almost a rite of passage; baseball teams go to spring training, buyers go look at homes, and the birds fly back north.

But this Spring is different than those of recent memory…
Because of the warm weather we experienced here in the Northeast for most of this past winter buyers have been out for months – making offers and buying homes.
Many sellers have finally come to understand that they need to have a compelling price on their home to attract buyers. The days of listing your home and negotiating down are over because there are homes on the market already priced correctly, and those are the homes that buyers are going to. The overpriced inventory doesn’t even get their chance to negotiate down.
Rates have ticked up as economic news (like unemployment numbers) has improved. That, coupled with rising mortgage insurance premiums and guarantee fees, seems to have given some sense of urgency to buyers.
The looming shadow inventory, which most certainly will keep downward pressure on home prices (when added to easier short sale approvals), has tended to encourage home sellers to be more realistic in their expectations.
The abundance of information available to consumers has further increased their need for sound advice from top-notch real estate and mortgage professionals. The cream is certainly rising to the top in those professions.

Low interest rates, a tremendous selection to choose from, and the seasonality of it all makes for an exciting next 60-90 days. My advice to anyone looking to buy or sell is that waiting to be aggressive could be a fatal mistake if you hope to find the best deal. From my experience, the best deals come when more people are competing for them…and that time is NOW!

There has been much talk about the government selling bulk foreclosures which will be converted into rentals. What will this actually mean to the housing market? For the answer to that question, we go directly to the 2/28/2012 Senate testimony of the person making the decisions on this subject: Edward J. DeMarco, Acting Director of the Federal Housing Finance Agency.

Have Any Foreclosures Been Sold in Bulk?

“Yesterday we announced the first transaction in our REO Initiative pilot program. This transaction includes approximately 2,500 properties, divided into 8 sub pools by geographic area.”

Will These Sales Be Limited to Certain Markets?

“The targeted Metropolitan Statistical Areas are likely no surprise to you because they represent hard-hit parts of the country: Las Vegas, Nevada; Phoenix, Arizona; various communities in Florida; Chicago, Illinois; Riverside and Los Angeles, California; and Atlanta, Georgia… Future transactions will also be targeted to these types of markets, where the supply of homes for sale is greater than the demand from homebuyers and where demand for rental housing is strong.”

Who Qualifies for These Sales?

“Investors will be able to submit applications to demonstrate their financial capacity, relevant market experience, and specific plans for purchasing pools of 6 foreclosed properties with the requirement to rent the purchased properties for a specified number of years.”

Will Most Foreclosures Be Sold This Way?

“Our primary goal will continue to be selling properties first to homebuyers who will use them as their primary residences or non-profits that include homes in mission-oriented activities. We also want to enhance the opportunity for smaller-scale investors to bid on properties, and obtain financing, should initial efforts to market the properties to owner-occupants fail.”

Will the Bulk Sales Program Lessen the Pressure on Home Prices?

“The number of properties available for sale by Fannie Mae and Freddie Mac represents only a fraction of the total supply that is depressing What is your home worth? in certain affected markets.”

Bottom Line

Any plan that reduces the number of foreclosures will help home prices. However, this plan will not have a dramatic impact on the large number of homes that are currently in the foreclosure process.

Q: With the real estate market in flux, is this a good time to purchase a vacation home?

A: Yes!  There are several factors in today’s market that make it an excellent time to buy a second home…….

     For the last few years you’ve been toying with the idea of purchasing a vacation property or retirement home near your favorite golf course.  What are you waiting for?  There are many factors in the real estate market that have conspired to make this a very good time to buy. Here are a just a few.

     Even though we are heading into a post-boom market, continuing low mortgage rates combined with larger inventory and more reasonable pricing have created an excellent window of opportunity for the buyer. 

      Over the past 20 years we experienced one of the longest running fiscal expansions in history, resulting in financial affluence for many people. This growth brought an extraordinary equity increase in primary residences and provided extra financial strength for those who are entering their retirement years. 

       The unpredictability of the stock market has many investors seeking the relative stability of the real estate market.  And even though the market in general is slowing, the second home sector will be a strong investment for years to come.

Every month Fannie Mae surveys American consumers about their attitudes toward housing. Responses in the January survey showed nascent glimmerings of hope for the single-family housing market.

Washington, DC, February 27, 2012

Pending home sales are on an upward trend, which has been uneven but meaningful since reaching a cyclical low last April, and are well above a year ago, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, rose 2.0 percent to 97.0 in January from a downwardly revised 95.1 in December and is 8.0 percent higher than January 2011 when it was 89.8. The data reflects contracts but not closings.

The January index is the highest since April 2010 when it reached 111.3 as buyers were rushing to take advantage of the home buyer tax credit.

Lawrence Yun, NAR chief economist, said this is a hopeful indicator going into the spring home-buying season. “Given more favorable housing market conditions, the trend in contract activity implies we are on track for a more meaningful sales gain this year. With a sustained downtrend in unsold inventory, this would bring about a broad price stabilization or even modest national price growth, of course with local variations.”

The PHSI in the Northeast rose 7.6 percent to 78.2 in January and is 9.8 percent above a year ago. In the Midwest the index declined 3.8 percent to 88.1 but is 10.8 percent higher than January 2011. Pending home sales in the South increased 7.7 percent to an index of 109.1 in January and are 10.5 percent above a year ago. In the West the index fell 4.4 percent in January to 101.9 but is 0.7 percent above January 2011.

“Movements in the index have been uneven, reflecting the headwinds of tight credit, but job gains, high affordability and rising rents are hopefully pushing the market into what appears to be a sustained housing recovery,” Yun said. “If and when credit availability conditions return to normal, home sales will likely get a 15 percent boost, speed up the home-price recovery, and thereby significantly reduce the number of homeowners who are underwater.”

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

# # #

*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales; it coincides with a level that is historically healthy.

Filings down 22 percent from 2010, down 32 percent from 2009
  State’s foreclosure rate 3rd highest in the nation

Foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 428,045 California properties in 2011, down 22 percent from a year ago and 32 percent below the level reported in 2009, according to the latest RealtyTrac® U.S. Foreclosure Market Report. The state posted the third highest foreclosure rate in the nation, with one in every 31 California housing units receiving a foreclosure filing in 2011.

Foreclosure filings were reported on 52,808 California properties in December, a 17 percent decrease from November and down 20 percent from December 2010. One in every 254 California housing units received a foreclosure filing in December, the second highest state foreclosure rate in the nation.

The Golden State continues to lead the country in foreclosure totals for 2011, followed by Florida, which reported 181,965 properties with foreclosure filings during 2011. Third highest total for the year was tallied in Arizona, where 113,967 properties with foreclosure filings were reported. Georgia had the fourth highest total, reporting 110,273 properties with foreclosure filings. Reporting 103,003 properties with foreclosure filings for the year, Illinois ranked fifth highest.

The rest of the nation’s top 10 state foreclosure totals for 2011 included Michigan (100,248), Texas (89,675), Ohio (79,422), Nevada (72,844) and Colorado (38,557). The top five states accounted for 50 percent of the nation’s total 2011 foreclosure activity.

San Joaquin County has top foreclosure rate honors in 2011
 One in every 18 housing units in San Joaquin County received a foreclosure filing during 2011 — 3.8 times the national average and 1.7 times the state average. Riverside County had the second highest rate with one in every 19 housing units reporting a foreclosure filing — 3.7 times the national average and 1.7 times the state average. Stanislaus County had the third highest rate, reporting one in every 19 housing units with a foreclosure filing — 3.7 times the national average and 1.6 times the state average.

Los Angeles County leads the state in foreclosure activity for 2011
 Los Angeles County continued to lead the way, reporting 91,893 properties with foreclosure filings during 2011. Riverside County was second highest in the state, reporting 41,319 properties with foreclosure filings. Third highest total was tallied in San Bernardino County, where 34,240 properties with foreclosure filings were reported. Reporting 29,786 properties with foreclosure filings for the year, San Diego County registered the fourth highest total in the state. Fifth highest was Orange County, where 25,480 properties with foreclosure filings were reported for 2011.

State the largest contributor to nation’s foreclosure total in 2011
 California accounted for 23 percent of the 1,887,777 properties with foreclosure filings reported nationwide for 2011. Total U.S. activity was down 34 percent from 2010 and was down 33 percent from the level reported for 2009. One in every 69 U.S. housing units received a foreclosure filing during the year.

“Foreclosures were in full delay mode in 2011, resulting in a dramatic drop in foreclosure activity for the year,” said Brandon Moore, chief executive officer of RealtyTrac. “The lack of clarity regarding many of the documentation and legal issues plaguing the foreclosure industry means that we are continuing to see a highly dysfunctional foreclosure process that is inefficiently dealing with delinquent mortgages — particularly in states with a judicial foreclosure process.

“There were strong signs in the second half of 2011 that lenders are finally beginning to push through some of the delayed foreclosures in select local markets. We expect that trend to continue this year, boosting foreclosure activity for 2012 higher than it was in 2011, though still below the peak of 2010.”

California Top Foreclosure Rates By County – 2011

California Top Foreclosure Totals By County – 2011