More homeowners in distress
Almost half of the entire American housing market is now distressed properties and economists project this number will rise according to the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey for March.
The Housing Pulse Distressed Property Index (DPI), rose to 48.6 percent in March, marking its second highest level in the past 12 months. The report indicates a backlog of foreclosures which could impact the DPI negatively and we would add that several big banks are holding back or slowing their foreclosure processes as they settle with state and federal agencies’ reform requests after the robosigning debacle wherein banks wrongfully foreclosed on homeowners.
A clog in the market? A silver lining?
The DPI report implies that buyers are taking a “wait and see” approach to buying and selling. Could there be a clog in the market despite the majority of homeowners still seeing an inherent value in homeownership?
Short sales did really well in March, up 17% from the month prior hitting a record high 20% while the survey indicates that damaged REO fell 3%.
Is the silver lining in the housing sector that more short sales are getting sold before the bank takes the homes?