Las Vegas homeowners had the highest U.S. foreclosure rate last year, and California and Florida cities accounted for 17 of the nation’s 20 worst markets as unemployment extended the housing recession.
Rising foreclosure rates in Utah, Illinois, Oregon and Arkansas metropolitan areas showed home-loan distress spreading to “previously insulated areas,” Irvine, California-based RealtyTrac Inc. said today in a report. A record 3 million homes will probably be seized this year, RealtyTrac has forecast.
“The dam will break and we’ll see a significant increase in foreclosures,” Michael Lea, a finance professor at San Diego State University, said in an interview. “The banks can’t continue to hope the economy starts growing.”
The U.S. jobless rate will probably stay at 10 percent in 2010, according to the median estimate of 60 economists in a Bloomberg survey. House prices that gained in the past six months will falter again after the government ends support for the mortgage market, Robert Shiller, co-creator of the S&P/Case- Shiller home price index, said yesterday.
The Federal Reserve’s $1.25 trillion program to buy mortgage-backed securities is set to conclude March 31, raising the risk that borrowing costs will jump. The purchases helped drive the rate on 30-year fixed U.S. home loans down to 4.71 percent in early December, the lowest level in Freddie Mac data going back to 1972.
“There is evidence that we’re entering a new wave of foreclosures, driven more by unemployment and economic hardship than what we’ve seen over the past few years,” James Saccacio, RealtyTrac’s chief executive officer, said in the statement.
Regular readers know I've been talking about the wave of foreclosures coming in 2010. Guess what? It's 2010. And on cue, here they come. Three million foreclosures this year. If Obama doesn't do something immediately, 2011 may very well be worse. And yes, this means this has to go to the top of the list, or the economy is screwed.
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