High End Foreclosures
For several months now, I have been alerting agents to the fact that this economy is starting to attack even the high-end seller. As I watched delinquencies dramatically increase in the sector of prime mortgages (good FICO score, good job, good downpayment), I realized that foreclosures in this sector could not be far behind. Well, yesterday, the World Street Journal reported on this exact point:
“New data suggest that foreclosures are rising in more expensive housing markets.
About 30% of foreclosures in June involved homes in the top third of local housing values, up from 16% when the foreclosure crisis began three years ago, according to new data from real-estate Web site Zillow.com. The bottom one-third of housing markets, by home value, now account for 35% of foreclosures, down from 55% in 2006.
The report shows that foreclosures, after declining earlier this year, began to accelerate in the late spring and that more expensive homes have more recently accounted for a growing share of all foreclosures.”
What does this mean to you? It means that even in the upper-end of the market there will be an increased supply of homes coming to the market and a portion will be foreclosures. As we all know, foreclosures usually sell at a discounted price. If you have listings in these price points, let them know it is best to sell them now rather than wait.