This was e mailed to me by contact without the source noted, but I felt was worth posting regardless. Cracks in a major market, even with giveaway mortgage rates:
A record number of Atlanta homeowners are facing
foreclosure, despite an improving economy and
still-strong housing market. The number of homes in
the process of foreclosure is up 24.8 percent over the
same time last year, according to data from the
Atlanta Foreclosure Report.
The threat of foreclosure looms over both moderately
priced and high-end homes, in neighborhoods from
Buckhead to Stone Mountain, as job losses and high
debt loads take their toll.
"[24.8 percent] is a pretty good jump," said Roger
Tutterow, an economist at Kennesaw State University
who follows the Atlanta housing market. "Although the
overall economy may be picking up speed, we really
haven't seen a whole lot of gains in employment and
personal income, which are factors that go into
foreclosures. Those are the parts of the economy that
need to improve the foreclosure numbers."
Atlanta Foreclosure Report's September report, for
homes that will face foreclosure Oct. 7, hit a new
record in the metro area with 3,431 properties listed,
said Bill Bramlett, managing partner of EquiSystems
LLC, which puts out the foreclosure report. Georgia
law requires foreclosures to be advertised for four
consecutive weeks before a house can be reclaimed by a
lender. Foreclosures take place the first Tuesday of
each month.
Jude Rasmus didn't need the foreclosure report to tell
her the number of foreclosures is way up.
"We took in 71 properties since Sept. 2 [when the most
recent homes in foreclosure were sold on the
courthouse steps]," said Rasmus, president of National
Foreclosure Service in Marietta, a real estate company
that specializes in selling foreclosed homes. "That is
a record-breaker to take in one month since we've been
in the business 14 years."
"Nothing's a surprise anymore, but some new
observations that we've come up with this year are
that the rate of repeat properties has really
climbed," Bramlett said.
Typically, 30 percent of all homes in the process of
foreclosure were repeat homes, meaning they had been
listed already for foreclosure within the past two
years, but escaped actual foreclosure, Bramlett said.
"Now we're seeing 50 percent of homes [being repeated
on the listings]," he said. "I think we are seeing a
final weeding out of all people who have had problems
making payments."
Foreclosures aren't the only indicator of economic
distress on the rise in Atlanta. Bankruptcies (of all
types) are up 14.6 percent through August, compared
with the same time last year, according to the U.S.
Bankruptcy Court's Northern District of Georgia
Atlanta division.
Trouble in paradise
Lithonia's 30058 ZIP code has the most homes listed
for foreclosure with 974. Most of the mortgages in
foreclosure were in the $100,000 to $200,000 range,
according to the Atlanta Foreclosure Report data.
During the same time last year, Lithonia's 30058 ZIP
code posted 812 homes in the process of foreclosure.
But homes in Atlanta's tonier ZIP codes aren't immune
from the foreclosure process. Atlanta's 30327 ZIP
code, home to Tuxedo Road, has had 90 homes face
foreclosure so far this year, including a $3.1 million
home on Rembrandt Road owned by Jack D. Aberbook,
according to the Atlanta Foreclosure Report. That
compares with 64 homes during the same time last year.
Bill Lawson, vice president and managing broker of
Harry Norman Realtors' Gwinnett/DeKalb office, said he
doesn't think job loss is the only reason for high
foreclosures in his region, which includes Lithonia
and Stone Mountain.
"Now we have to point the finger back to the mortgage
end of it," he said. "They are allowing loans that
maybe they shouldn't. Everybody wants people to get
into their dream homes, and there's nothing wrong with
that. I'm not saying it's fraud, but they are
stretching people into houses they can't afford."
Rasmus said she is seeing more homes in Stone
Mountain, and more condos, going on the auction block.
Rasmus sees banks being more aggressive in trying to
get foreclosed homes sold.
"The banks are taking a whole different position in
pricing," she said.
A few months ago maybe a bank held one or two REOs, or
real-estate owned, properties -- a bank's term for a
foreclosed home. Now a bank may have 15, Rasmus said.
But Mary Welch, a spokesperson for Bank of America
Corp., said the Charlotte, N.C.-based mega-bank is
"not taking any other measures to move properties
quicker. It's very much business as usual."
Bank of America simply wants to recover the money lost
in the defaulted mortgage, she said.
Better times ahead?
Nationally, loans in the process of foreclosure and
loans in delinquency declined slightly in the second
quarter, compared with the same time last year,
according to data released Sept. 10 by the Mortgage
Bankers Association of America.
The percentage of loans in the foreclosure process
nationally in the second quarter stood at 1.12,
compared with 1.13 percent a year ago, the MBA said.
Also in the second quarter, 4.62 percent of all loans
were in delinquency, compared with 4.77 percent of
loans in the second quarter of 2002.
In Georgia, 5.9 percent of all loans were in
delinquency in the second quarter, while 1.27 percent
of loans were in the process of foreclosure, according
to the data. The association does not break the data
down by metropolitan statistical area.
The rise in delinquencies since first-quarter 2000 is
attributable to job losses across the country, said
Doug Duncan, MBA senior vice president and chief
economist.
"Job growth and employment is the single most
determinant in changes in the level of delinquencies
and foreclosures," he said. |
