This data and graph were sent to me on email without a link to the source which is cited as NAR. I looked on thier site and could not find the info presented here.
Oregon and Washington have high employment rates, stable or appreciating property prices, 48th and 42nd respectively out of 50 states in sub prime mortgage origination over the past five years and as a result show declining mortgage delinquency and foreclosure rates.
10 Comments on “NAR Data”
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Of course we have no foreclosures yet.
All you have to do with rising prices is refinance and pull cash out or sell and bank your equity….
Now we are starting to see falling prices and tightening credit standards we’ll see the foreclosures start to mount up in Oregon in due course.
We were late to the party so we’re late to the bust – but make no mistake – it’s in the post.
FHA loan limits are $305k for Portland – so unless you come to the game with perfect credit and a stash of cash anything over 300k is going to start to struggle to move.
Roll on the bust so regular families can buy regular houses without it eating up 50%+ of their income.
I’m not so sure about the “strong job growth” part. At least not when it comes to the kinds of jobs that’ll enable you to buy a $300K house – I don’t see a lot of growth in those $75K jobs in the PDX area. Take away some of the mortgage and real estate-related jobs and we’ll actually see a contraction in those higher-paying jobs.
Oh, and how about this:
Dow Jones Newswires
09-05-07 1844ET
WASHINGTON (AP)–A third of home loans originated by mortgage brokers failed
to close in August as investors shied away from riskier borrowers, a new survey
says.
…The survey also found that nearly half of borrowers with adjustable rate
mortgages were not able to refinance their loans. That’s a major concern of
policymakers as an estimated that 2.5 million mortgages given to borrowers with
weak credit will reset at higher rates by the end of next year, according to the
Federal Deposit Insurance Corp.
That can’t be good…
Maybe I am missing something here. What’s a ‘good’ foreclosure rate?
I also find it interesting that if the number of foreclosures went from 10,000 to 7,500, the data is reported as -25%. Finally, I am not so sure about the sample size. It could be that there were very few foreclosures in Utah, but the number went slightly down, but in terms of percent it looks like a large reduction.
Finally, the two periods are very interesting:
2005 Q1 versus 2006 Q4
I am clueless as to why those two periods were selected! Maybe they sought the data to support a preconceived position. How does this relate to market prices?
According to Realtytrac Oregon had 669 foreclosures in July 2007 (404 NODs, 246 NTSs, and 19 REOs). This represented a 24% decrease from June and an 11% increase over July 2006. In July there was one foreclosure in Oregon for every 2,329 households, ranking Oregon 30th in the country. Nevada led all states with one foreclosure per 199 households… OUCH!
This is a pretty misleading graph. It implies that price appreciation keeps foreclosure rates low, but it neglects the fact that high foreclosure rates can themselves actually cause depreciation. Every area in the country used to be able to say that strong price appreciation is keeping foreclosure rates low, but that did not stop things from changing very rapidly.
The fact that foreclosures skyrocketed not because of job losses, but because appreciation slowed, demonstrates that the boom was little more than a Ponzi scheme. (A Ponzi scheme also appears profitable as long as you can continue to pull in new members.) It shows that mortgages were being repaid with “appreciation money” instead of real earned income, and this enabled prices to become completely disconnected from fundamentals.
An interesting fact that I read just last week. 32% of the Nations foreclosures are all located within two States! Florida and California. Now that makes this a very localized problem.
Sure FL and CA are foreclosure hot spots right now, but by no means is this a localized phenomonon: CA and FL led the real estate mania. We’re about a year behind. If 1/2 people who need to refi are not able to (see my earlier post) it’s gonna get really ugly.
anticipating a response: But everybody wants to move to PDX!
Even more everybodies wanted to move to CA and FL. Those areas which high in-migration haven’t been spared.
Of course foreclosures are more concentrated in some states than others, so it may seem like a localized problem. But remember, foreclosures are only a symptom of the disease — access to credit — which is affecting the entire chain from consumer to corporate.
I don’t see a lot of growth in those $75K jobs in the PDX area.
Only 17% of households in the portland-vancouver-beaverton make more than 75K.
An interesting fact that I read just last week. 32% of the Nations foreclosures are all located within two States! Florida and California. Now that makes this a very localized problem.
You mean everyone isn’t a 26 year old software engineer making 120K, shopping at Diesel for $250 jeans and snapping up 700K condos in the Pearl?