Is the sky falling? Or, is the media stirring up a frenzy? Talk of the increase in foreclosures is scattered all over the news this week.
According to RealtyTrac, October’s foreclosure findings nearly doubled from the same month a year ago. A total of 224,451 foreclosure filings were reported last month, up 94 percent from 115,568 in October a year ago.
But, compared to September (month-to-month) the rate of filings is up just 2 percent, and the number of default notices is down 9 percent from what it was at this year’s high in August. To read the full release, click here.
The media would make you think the sky is falling, but consider this. Even with all the foreclosure activity that’s happened in the last few months, the national foreclosure rate for October was 1 home for every 555 households. That’s 0.18 percent. It’s not D-Day just yet.
Still, foreclosed properties can have a negative impact on neighborhoods by reducing home values, and as it turns out, it can go even further than that. RealtyTimes writer Broderick Perkins wrote an interesting article titled "Foreclosures Undercutting Social Benefits of Homeownership." It paints a pretty stark picture of the overall effect foreclosures have on society:
It’s not surprising then that the positive effects of homeownership are vanishing with growing declines in homeownership, especially where there are concentrations of lost homes.
Bottom line, it’s in our best interest as real estate professionals to try and help at-risk homeowners to keep their home. If you know anyone who needs help, HUD is a good place to start. Click here for more information.