10 Year Foreclosure Rates
One would think, from the doom and gloom news, that the home foreclosure rate is the highest ever. But, only 1 out of 538 households does not seem high. What is higher is the percentage of mortgages made that were subprime. These bad credit risks are now 20% of the market thanks to government organizations like Fannie Mae and Freddie Mac that insure bad loans. Now the government wants to increase the size of loans the government agencies will insure. The government employees never learn, or they may just be looking out for their own careers.
"The number of U.S. homes receiving at least one foreclosure filing jumped 57 percent in March to 234,685, compared with 149,150 properties a year earlier. Filings include default notices, auction sale notices and bank repossessions.
The overall foreclosure rate is 5 percent higher than in February, which saw an unexpected month-to-month decline over January. March marked the 27th consecutive month of year-over-year increases in national foreclosure filings.
That meant one in every 538 households received a filing during the month. Forty-four percent were households that slipped into default for the first time and more than a fifth were homes banks took back."
The problem with the housing market in 2007-08 was a typical 'bubble', like the Tulip Mania bubble of 1635. http://www.econlib.org/library/mackay/macExContents.html Like the Tulip Mania bubble that burst, the housing bubble had to burst.
One thing about housing, it is cyclical. If there is too much inventory there will be less new construction and renovation. After the housing bubble of 2005-08 the number of new housing starts was the lowest in 17 years! "The Commerce Department said US March housing starts fell 11.9 percent to a 947,000 unit annual rate, down from an upwardly revised 1.075 million units in February. That pace was the lowest level since March 1991."
Why did we not hear much about the foreclosure rates in 2000. People were able to refinance. The stock market was at an all time high. The following year 9/11 happened, along with the stock market bubble bursting. The following year 2002, was the fight against the Taliban in Afghanistan. The following year, 2003, the media was focused on the Iraq war. Today, 2008, the media has little to talk about, so they are preaching doom and gloom in the housing market, a market where only 1 house in 500 is in foreclosure.
Charles Tolleson, The Happy Misanthrope
"The number of U.S. homes receiving at least one foreclosure filing jumped 57 percent in March to 234,685, compared with 149,150 properties a year earlier. Filings include default notices, auction sale notices and bank repossessions.
The overall foreclosure rate is 5 percent higher than in February, which saw an unexpected month-to-month decline over January. March marked the 27th consecutive month of year-over-year increases in national foreclosure filings.
That meant one in every 538 households received a filing during the month. Forty-four percent were households that slipped into default for the first time and more than a fifth were homes banks took back."
The problem with the housing market in 2007-08 was a typical 'bubble', like the Tulip Mania bubble of 1635. http://www.econlib.org/library/mackay/macExContents.html Like the Tulip Mania bubble that burst, the housing bubble had to burst.
One thing about housing, it is cyclical. If there is too much inventory there will be less new construction and renovation. After the housing bubble of 2005-08 the number of new housing starts was the lowest in 17 years! "The Commerce Department said US March housing starts fell 11.9 percent to a 947,000 unit annual rate, down from an upwardly revised 1.075 million units in February. That pace was the lowest level since March 1991."
Why did we not hear much about the foreclosure rates in 2000. People were able to refinance. The stock market was at an all time high. The following year 9/11 happened, along with the stock market bubble bursting. The following year 2002, was the fight against the Taliban in Afghanistan. The following year, 2003, the media was focused on the Iraq war. Today, 2008, the media has little to talk about, so they are preaching doom and gloom in the housing market, a market where only 1 house in 500 is in foreclosure.
Charles Tolleson, The Happy Misanthrope
posted by Charles Tolleson @ 9:19 AM
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