The Unforeclosed

Pat Haddad - I agree there is a slow motion effect to it.  I'm kind of over the fire drill they've been running about it.  It's hard to stay on high alert for 3 years while homes come on the market slow as molasses.  Maybe there will be a flood somewhere at sometime, but I don't think it can be predicted by the amount of the unforeclosed inventory.

Gary & April - I agree, I think it would be hard for them to decide to do something and follow through with it well.  But, I do think they are capable of deciding NOT to do so something and following through with that.  LOL.  I also agree that we could sell a whole lot of these homes right now anyway.

Susan - I agree, we have to work all these homes through the system to really make a recovery.  And, I also would love to have more inventory to sell in my market.  There hasn't been enough easy to buy inventory in a long time.  The longer approval process for short sales gives many the misimpression that there are plenty of truly available homes to buy.  Many already have offers and are waiting on bank approval.

Jack Mossman - You raise a good point.  Maybe those homes are selling at auction or in bulk to investors?   We have several investors that are buying at auction in my area and making handsome profits.  When those homes hit the market, they are not "foreclosed" homes and the investors can ask for tip top dollar after they have cleaned them up.

Donne - Same in my area.  The highest end of some markets still probably has some price recessions coming.  But the other markets are on fire with multiple offers and bidding wars.  Yes, I think if we could move the short sale inventory quicker, people could see how few homes are truly available.

Liz Lockhart - Yes. I do think there is some thought behind it.  It's gone on too long now.  Right before every Spring they tell us "Get ready" and then we have the same type Spring with not enough homes to meet demand.  Right now I think we could easily absorb a lot of that inventory.  I'm working with buyers who sat out the housing boom because they thought things got too crazy.  So, some have been waiting to buy for 5 or more years!   They are motivated and the inventory comes out like molasses.

Tim - Yes, this is definitely something that is common.

Ken Barker - For sure, if there is a crystal ball I don't have it.  Who knows.  However, I am starting to notice a pattern around December/January when the inventory naturally piles up a bit - I always hear about a huge influx of REO homes on the market in Spring.  In the Spring I still don't have enough homes for all the buyers and there are bidding wars and frenzied activity.  That has been the last 3 years.  Maybe it's just that what the bank thinks is a tidal wave is more like blip to us.  I'd love to have more homes to sell though.

Cynthia - I wonder if it is the same for other banks.  Of course, IndyMac has a bit of a unique circumstance too since they went through receivership.  I also think Freddie and Fannie operate a little differently as well. I will often see REOs from them when the banks don't appear to be releasing inventory.

Thomas - They should be concerned and get this inventory worked through as short sales when they can.  The City of Lompoc just had a heinous proposal that would put banks and their agents on the hook for homes that are not well maintained. 

Doug - Me too!  No matter what --- this is rough landing!

Jeanne - Who knows?  I don't think they are capable of capitalizing on fast market shift.  But, I do think they have decided that they are going to take their sweet time working throught this mess, because that is exactly what they are doing.

Jeramie - Yes, improving the short sale process is a key part.  Me too!  I'm just not counting on that tidal wave this year.  Too many false alarms.  Show me the money!

Deborah - Yeah I also think they have a plan.  But I don't think the number of "unforeclosed" homes will tell us what it is. 

Jim Frimmer - That's what I'm saying.  Show me the money!

Jon Zolsky - Yeah well you are cracking me up.  You and I know it is all about the timing! LOL.

Hi John - I would love to hear what those factors are!  I am waiting as well! 

Charita - Just a little.  LOL  I am tired of people saying "Get ready!"  Kind of like an offer that never comes!  I do think there is an effort to elongate this process but hey I could be wrong.  You are right short sales actually take about two weeks to process.  We know this because smaller banks routinely approve them in much less than 30 days.  And, typically we bug the banks to look at our file for 3 months, they look at it for two weeks and then make a decision.

Donne - Yes, I do think there is a reason behind the current tactic as well and unless someone gives me a new reason to believe they will reverse course, I think they will continue with the same plan they have been using for the past 3 years of handling distressed inventory.  I could be wrong but we haven't seen tsunami in 3 years. 

Michael Jacobs- That's the other part of it for me.  I don't fear it because we have so many buyers that can not find what they want.  Or the process of buying a short sale is wearing them out.  Bring it on I could sell all those houses right now!

Chris Ann- You bring up an important point and I've heard the same thing.  Reserves.  It's true and it's another reason that I don't believe the status quo will change overnight, unless there is rule change or a policy change somewhere.  They have a reason for doing what they are doing.  The number of homes eligible for foreclosure is not the sole determinate of what we see on the market.  Also, for me it explains why the flow of homes from Freddie Mac and Fannie Mae seems more consistent and steady rather than the small spurts I see with the major banks (BofA and Wells Fargo).  Here they are absorbed very quickly with the buyers asking for more.