When Will We Notice the Elephant in the Room?
There has been more frequent discussions recently of renewed interest in housing, slowly increasing sales and supposed stabilization in prices...but the elephant in the room is slowly growing.
That elephant is foreclosures. REO inventory is rising, over 4 million seriously delinquent loans, even the problems appear to have peaked, there are still over 600,000 properties in REO, which will only put more pressure on prices when they come to market.
Over 14 million homeowners are "under-water"... 4 million of those by more than 50%.
Bottom Line...Foreclosures are ramping up again and can very easily endanger today's fragile housing recovery.
Reducing Mortgage Balances to today's Current Market Value is the best way to stabilize the housing industry.
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