More Homeowners Fall Behind

Today, the Mortgage Bankers Association reported 12-percent of homeowners with a mortgage are behind on their payments or in foreclosure as the housing crisis spreads to borrowers with good credit. The wave of foreclosures isn't expected to crest until the end of next year, and the foreclosure rate on prime fixed-rate loans doubled in the last year. This now represents the largest share of new foreclosures.

From the Press Release:

At the same time, almost half of all adjustable-rate loans made to
borrowers with shaky credit were past due or in foreclosure.

The worst of the trouble continues to be centered in California, Nevada, Arizona and Florida, which accounted for 46 percent of new foreclosures in the country. There were no signs of improvement.

The pain, however, is spreading throughout the country as job losses take their toll. The number of newly laid off people requesting jobless benefits fell last week, the government said Thursday, but the number of people receiving unemployment benefits was the highest on record. These borrowers are harder for lenders to help with loan
modifications.

According to Census 2000 Alameda a little more than 9,000 of the 12,085 homes had a mortgage. The Census data is really old, but the ball park number is 75% of homes carry some financing. Given that number that means that up to 1,200 home owners on the Island could be behind based on the National number.

Given that the Alameda market has been fairly stable compared to the Nation and California as a whole, I believe that percentage is on the high side for our little community. But if we take just quarter, 3%, that is still 272 homeowners with payment troubles. That's significant compared to the existing inventor would be a huge impact to pricing.

The news on housing this week has been fairly ominous, but as I have said before we just have to continue to watch and see what happens.

Can You Find Money or a Deal

A couple of housing stories, the first is on the stagnant mortgage market and the second takes a look at the increase nationally in December home sales. The mortgage story is the most interesting because even if you want to buy in today's market you may find that it will be very difficult. Donald Trump is interviewed and reminds you its even tough for millionaires. The sales story focus on falling home prices in places like Phoenix and California.  Just a reminder that in Alameda December sales saw no spike.