Record Foreclosures Coming - How Will You Capitalize?

[REW Reed]

I was just reading on CNNMoney.com about how more than 2 million subprime ARMs are about to reset at much higher rates. This could mean as many as 600,000 home owners in trouble and a large number of foreclosures.

I was wondering if people are already seeing the effect of this and how the real estate community can take advantage of the situation?

[mkrotchie]

I actually just wrote in my blog referencing that very article. Here in Tucson we have been seeing a swelling inventory but prices haven't yet adjusted to where I think they should be. We'll be getting June's figures shortly and I'll update this post.

[REW Reed]

Great blog post. A must read on the issue.

[FPBG]

Very Interesting statistic and good to know! Unfortunately not good for the homeowners in these situations. The Bulk REO Pool/Portfolio market is hot right now for many Investors looking to profit from deep discounted packages (From the Banks needing to Minimize losses). I am curious to see the numbers of people jumping on the bandwagon.

[Malok]

I'm seeing isolated cases of persons trying to sell a property, just before it goes to a short sale, etc.

Showed a property yesterday that a person purchased for $360,000 2 years ago, and its on the market for $319,900 now.

[Thats a HUGE drop in my market - since my market only averages 3-5% appreciation per year.]

[BuyHawkeye]

I'm slow to push the panic button, but our list for this month has 100 more properties on it than last month. That is a 20% increase in one month. I'll wait to see what next month's looks like before I start frothing at the mouth.

Regardless, we are seeing an increase in homes that have virtually no equity in them coming up for auction. It is common to see a new homeowner fail in the first year, but in years past there was still about 20% equity in the property due to their downpayment or 2nd loan. Now it appears as if many 100% loans are defaulting. Those will go straight back to the lender and will cause a problem in the coming months.

[Sam Dodd]

In my market that mirrors Las Vegas we have lots of inventory and builders are still building. You see many of these builders purchased the land on loans and there only hope is to build it out. Its definately not helping anything. One thing we do have going for us though is strong job growth and growth in general. Hopefully we can grow our way out of this over inflated market.

[Jnazareno]

well last month or so i went to an auction and actually bought one good property for 20% below resale .. nice home, need some little touch up but probably no more than $2000 if you know the right people .. my right hand guy got one for 30% below and ticked me off - lol

I actually went to auction places as far as detroit and saw a person won on a bid for a 70% discount for a condo or townhome..heard property was in a nice place..then again detroit market is really terrible right now.. so i understand why bank wanted to throw it away

I suspect the market would be bad until 2010 .. but im not discouraging people from buying, it's the BEST time to start buying right now!!! remember the stock market crash of 2000? well last 7 years i've avg more than 30% return on investment or more becuase I've followed the basic investment fundamentals..research is the key, if the numbers you've come out after you've done your research looks right, then it must be a great buy ...