North Carolina to set Foreclosure Record in 2010

I hear from sellers almost daily that they are going to ride the market out.  After all, it has to get better at some point, right?  I agree, it will get better, but I don’t see a major upswing in prices any time soon.  I’m not an economist, but I do understand supply and demand.  I also understand the effect of foreclosures on the “conventional” real estate market.

In short, too many foreclosures in a market drive prices down.  And in North Carolina, we have way too many foreclosures.  According to Charlotte Business Journal, we will set a new record this year with over 70,000 foreclosures.  The previous record was last year with 63,000 foreclosures.  That’s an 11% increase!

In order for the market to correct, we will need to work through the backlog of foreclosed homes (as well as conventional sales and short sales).  Of course, the recent moratorium on foreclosures (while the banks audited their foreclosure processes) only delayed some of these homes coming to market.  The good news is that for some of the short sale transactions, it provided extra time to get those deals done.  According to Jacksonville, Fla.-based Lender Processing Services Inc:

“…moratoria contributed to further timeline extensions, as the average number of days past delinquent for loans in the foreclosure process approaches 500.”

500 days?  Wow, that’s almost a year and a half!  If you’re a Realtor, this means you may have more time to find a buyer before you lose your listing to foreclosure. If you’re a seller weighing your options (foreclosure, short sale, deed-in-lieu, etc.), be sure that you begin by discussing your individual situation with an attorney.  And don’t discount the short sale option before you do so!

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