Maybe it depends on how you look at it… The huge run-up of foreclosures in the last two years seems to be abating. According to Amy Hoak, writing in Real Estate Weekly (online ed., Dec. 4), “A University of Michigan researcher is predicting that foreclosures will begin to fall next year, dropping from 2.75 million in 2009 to about 1.75 million in 2010 and 2011.” Predictions suggest further declines in 2012 and thereafter.
This is good news for homeowners hit with the negative effects on home values of neighboring foreclosures. The market absorption of today’s foreclosures will speed the recovery of property values for all concerned.
For investors, however, this is a reminder “the clock is ticking”. Statistics on last quarter’s monthly home sales indicate increasing sales volume and modestly rising prices. Some regions of the country never saw the declines experienced elsewhere and when the occasional foreclosure appears, bidding wars ensue. No distress there.
All business cycles turn. Fortunes are made by those who “time” their market moves, in this case buying when the market is down so the advantage is theirs when the market turns up.