It’s official. The numbers are in and 2016 real estate trends are pointing to an upswing in the housing market. Finally arriving at pre-crisis levels, a recently released CoreLogic report shows foreclosure levels have plummeted to nearly 27%, the lowest levels since the year the housing crisis began, from 603,028 in 2014 to 476,000 in 2015.
Finally through the worst
What’s to thank for the housing market recovery? Banks tightening lending criteria, increased housing prices, and a stronger economy, leading to more homeowners with steady jobs, which reduces the top two reasons banks repossess: Lost jobs and reduced income levels.
Though the market is up, however, experts point to a classic double-edged recovery. The same factors helping fight the housing crisis and boosting the rebound are also hindering many would-be buyers from securing financing, especially in the states hardest hit, according to real estate trends.
The hardest hit states?
The five states below account for half of national foreclosures…
- Florida: 79,109 completed foreclosures; the most in the nation.
- Michigan: 48,865
- Texas: 29,815
- Ohio: 24,456
- Georgia: 24,239
Though lessening, working and middle class buyers are still experiencing financing obstacles. Some do not have the 10% down payments required to qualify for loans. Others have poor credit, recovering from brushes with the foreclosure crisis themselves. Younger generation buyers have no credit. And in some markets, especially those in low to moderate income areas where a great deal of foreclosures occurred during the crisis, banks are reticent to lend.
On the upswing
Though these issues will as yet continue to work themselves out, mortgage delinquency rates are still expected to decline in 2016, with the rebounding of the national economy, along with housing prices, on the horizon.
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