Posted on August - 11 - 2010
Foreclosures worsen in Northwest and Midwest parts of America
The rate of American residential foreclosures is escalating in Northwest and Midwest areas of the country that were previously spared the worst. This comes on the back of a total of 14 million Americans out of work, and could drive the United States back into recession according to Alan Greenspan, former Chairman of the Federal Reserve.
Repossession rates rose in Colorado, Idaho, Illinois and Utah during the period April to June 2010 with the result that all four now rank among the 10 States most badly affected in the country. This is a further reflection of a troubled national economy where foreclosures have doubled in 19 states, and tripled in seven of these.
“The housing downturn started late in the northwest and now it’s ending late,” according to a leading economist. “Pennsylvania, Idaho, Oregon and Washington lagged behind the national cycle and will suffer declines after other areas stabilize.”
On a more positive note, new notices of delinquency are beginning to fall, noticeably in States where the crisis first began. These include drops in California (43%), Florida (37%) and Nevada (27%), April to June year-on-year.
“The worst is over, but it’s going to be a long road ahead,” the analyst added.
Last month over 325,000 American homes (or 1:397 households) were the subject of foreclosures or default notices. While this is 4% worse than June, it is nevertheless 10% better year-on-year. Just short of 93,000 properties were seized by banks during the month – the second highest number on record. “The numbers are exploding due to unemployment and economic displacement,” I was told. “We will see them get a lot worse unless we see some job creation.”
The unemployment rate rose again in July and reached a 27-year high at 9.5% according to the Labor Department. This represented 4.5 million Americans on unemployment benefits and a further 3.9 million receiving emergency assistance with their mortgage commitments. Current Chairman of the Federal Reserve Ben Beneke told Congress late last month that the outlook was unusually uncertain. The worst affected metropolitan area was Chicago, where 76,000 jobs were lost between July 2009 and June 2010. The United States Bureau of Statistics recorded a further 18,900 job losses in Denver, with 18,700 in Detroit. Employment fell by 4.1% in Grand Junction, Colorado, and by 2.7% in Bend, Oregon.
Residential property prices and residential property rights were inevitably negatively affected. Banks tightened screws on known defaulters, many of whom received a visit from the sheriff.
There has probably never been a better time to buy American foreclosed homes than now, and at an affordable price too. Why don’t you visit and find a great bargain?
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