Foreclosures remain front-page news. RealtyTrac reports the number of homes taken over by banks jumped 35% in the first-quarter of 2010 compared to the same year-ago quarter. More worrisome, foreclosures grew 7% from the last three months of 2009.
It appears we’re backsliding again. The foreclosure rate was easing late last year, as banks were pressured to modify home loans. In addition, many states enacted foreclosure moratoriums to give troubled homeowners some breathing room to catch up on their payments. Never mind that banks were struggling with their own survival.
Our modus is to accentuate the positive when possible, since the positive is given short shrift by the mainstream media. On that front, the foreclosure problem remains concentrated in 10 states, lead by the usual suspects – Nevada , Arizona , Florida , and California (but not the entire state).
We found more positive news in the NAHB/Wells Fargo Housing Market Index, which showed a marked improvement in homebuilder sentiment, rising to 19 from the consensus estimate of 16. Many commentators credited additional business driven by the impending expiration of the federal homebuyer’s tax credits, but that doesn’t make sense. We’re all aware that a buying surge was likely heading into April, but homebuilders are surely looking beyond April. Perhaps the fact housing starts posted at a better-than-expected 626,000 units for March is a better measure of the renewed optimism.
Other variables are at work too; many are positive, including economic activity, which increased in most parts of the country, according to the Federal Reserve. We’re not surprised. In past editions, we noted that the stock market is a reliable economic indicator, and the stock market continues to show a strong recovery.
Our optimism appears to be rubbing off on more consumers, of whom 72% opine that it’s a good time to buy a house, according to a recent Gallup poll. Gallup said the figures were “potentially encouraging,” presenting sellers with an audience of buyers who believe buying a home would be a good investment.
Brad Applegate, FC Tucker, Indianapolis Real Estate
Lawless Team
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