Friday, October 20, 2006

Texas Foreclosures 'Pick Up Steam'

The Star Telegram reports from Fort Worth. "For the third month in a row, Tarrant County has registered more than 1,000 foreclosures, and the number of homes posted for the November auction appears to be a record high."

"The 1,222 foreclosure postings is the highest number recorded by Foreclosure Listing Service of Addison, company President George Roddy said Thursday. He said his firm wasn’t tracking Tarrant foreclosures in the late 1980s when the real-estate market crashed, but he noted that the county had significantly fewer homes then."

"'They’ve definitely picked up steam, if you look at this month,' Roddy said. 'It’s unbelievable.'"

"Foreclosures are up 47 percent from last November, when 830 homes were posted. Foreclosure Listing Service counted 1,220 postings in September and 1,063 in October.
'That gets your attention — that’s extremely high,' Roddy said. 'For the last three months, we’ve seen some abnormally high foreclosure numbers.'"

"The November postings also ensured that 2006 would be a record year of postings. The year-to-date total for 2006 is now 10,979, already ahead of 2005’s full-year total of 10,387. The foreclosure postings are approaching the stratospheric levels of the 1980s real-estate crash. In Dallas County, there are 1,886 homes posted for foreclosure next month. In 1989, about 2,000 foreclosures were posted a month, Roddy said."

"Many people in real estate who work with people facing foreclosure say many of the homeowners are being squeezed from all sides. Homeowners who have financed 100 percent or more of their home purchases often find themselves owing more than the value of the home. Borrowers who took advantage of teaser short-term rates are now seeing the rates ratchet upward."

"Some unfortunate buyers combined ARMs with 100 percent financing. Randall Dunn, who buys homes from homeowners facing foreclosure, hears from them all the time. 'Those are the ones who say, 'Please buy my house,' Dunn said. 'But they have no equity, so how can I buy their house?'"

The Dallas News. "Home foreclosure postings in the Dallas-Fort Worth area have surged to their highest level since the 1980s. Home foreclosure postings reached about 35,300 so far this year, increasing 20 percent over the same period a year ago. That figure has already surpassed the total for 2005, which was about 32,500."

"A likely culprit: aggressive lending, in which mortgage companies sell homeowners products that might not be suitable in the long term. Many homeowners appeared to be struggling with adjustable rate mortgages, which accounted for about a third of foreclosure postings this month, Mr. Roddy said. That category includes nontraditional mortgages that offer low payments the first few years, often followed by sharply increasing payments."

"It's not the most worrisome performance ever for foreclosures in the Dallas area. In 1989, foreclosures in Dallas County reached as high as 2,000 a month in a smaller overall market, Mr. Roddy said. This month's figure for Dallas County was 1,886."

"The latest rise in foreclosures has added to concern about the local real estate market, which has cooled in recent months. In September, local home sales dropped, the number of homes for sale increased, and prices declined slightly as homebuyers pulled back to see what would happen to the national housing market."

Still, there are also positive signs, said Craig Jarrell, president for the Dallas region at Pulaski Mortgage Co.

"Foreclosures this month rose by 49 percent in Dallas County, 47 percent in Tarrant County, 65 percent in Collin County and 37 percent in Rockwall County. About 80 percent of the properties posted for foreclosure are worth $200,000 or less, with an average value of about $115,500 for Dallas, Tarrant, Collin and Denton counties, Mr. Roddy said."

"Still, a small portion of homes have values over $500,000. 'It's safe to say that all walks of life in the D-FW area are affected,' he said."


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