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Housing Market Still Troubled

Few take advantage of lower prices, first-time buyers skittish

By Mary Silver
Epoch Times Staff
Created: October 22, 2012 Last Updated: October 22, 2012
Related articles: United States » National News
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The housing market, home prices, and foreclosures are not much better than they were in 2008, according to an Oct. 22 report from RealtyTrac. The company put together the “Election 2012 Housing Health Check” because “housing as an issue has been overlooked a lot in this election, in our opinion,” said RealtyTrac Vice President Daren Blomquist in a phone interview.

The company is the leading online marketplace of foreclosure properties, making otherwise hidden information available for subscribers. It found that 65 percent of U.S. counties are now worse off than in 2008, and 35 percent are better off, in terms of housing prices and numbers of foreclosures.

“Another thing dragging things down is unemployment; unemployment makes people less likely to buy and causes people to lose their homes,” said Blomquist.

The majority of houses across the country have lost value over the past four years. This offers a good opportunity for first-time buyers and for investors, yet few people have seized the chance. It is hard to be sure prices have reached the bottom of their fall, so people hesitate, according to Blomquist.

“If prices are still dropping, you could be catching a falling knife,” said Blomquist. 

“Foreclosure inventory is down compared to four years ago.”

—Daren Blomquist, vice president, RealtyTrac

Those who bought during the bubble suffered a financial wound. Homeowners who bought at high prices are now reluctant to sell, knowing that they would have to pay money at closing. That situation sidelines people who might otherwise be trading up into bigger or better houses. 

Where prices are starting to go up, it appears the crisis has bottomed out. That is true in some of the larger counties in the United States: Atlanta’s Fulton County, New York County, N.Y., Fredericksburg County, Va., Cuyahoga County, Ohio, and Orange County, Calif., among others.

Foreclosures have passed their peak, according to the report.

The “foreclosure inventory is down compared to four years ago. In a lot of counties, we are past the worst of it,” said Blomquist.

Banks are more willing to allow short sales, in which they absorb the difference between what a homeowner borrowed and what they could sell his house for. 

Government policies have required lenders to go more slowly and document foreclosures more carefully after a lawsuit revealed widespread fraud and other abuses.

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