The Center for Responsible Lending estimates that the U.S. has surpassed 1 million foreclosure filings in 2009, and there is no end in sight as an alarming number of Americans are delinquent on their mortgage payments. Will the next wave of foreclosures mean a further drop in the housing market? Property Wire reports on the latest foreclosure and delinquency numbers.
More than half of property foreclosures in the US now involve prime mortgages and the real estate market may not stabilize until 2011, it is claimed.
The National Delinquency Survey from the Mortgage Bankers Association shows that foreclosure activity was at an all time high in the first quarter of 2009.
The survey shows the delinquency rate, which excludes homes in the foreclosure process, hit 9.12% in the first three months of 2009 compared with 7.88% in the last quarter of 2008.
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It means that 12% of all mortgages are now at least one payment behind. The ongoing severity of the real estate crisis is demonstrated in the seriously delinquent figures which relate to loans that are 90 days or more behind. It is now at 7.24%, some 94 basis points higher than the last quarter of 2008 and an astounding 321 points higher than last year at the same time.
Total foreclosure inventory was also up, with 3.85% of all mortgages somewhere in the foreclosure process at the end of March 2009 compared with 3.3% in by December 2008.
More worryingly, not only has foreclosure activity surged, it’s become more widespread, as prime, fixed-rate mortgages now constitute 56% of mortgages in the foreclosure process.
The MBA said in a statement that it does not expect any recovery in the property market until at least the end of 2010 and probably it will be 2011 before things turn around.
The transient nature of the market, where people are relocating to new towns for new jobs and turning over home keys time and time again, must settle, before the housing market can begin a solid recovery, the MBA explained.
That means that the job market must take a turn in the right direction before property can do the same, which the MBA predicts will come in the first half of 2010.
This article has been reposted from Property Wire. View the article on Property Wire’s international real estate news website here.