In the Past few years we have dealt with an oversupply of homes. So many foreclosures and short sales, at any given time you could find a dozen homes that fit your criteria; but that has all changed. I found this great article at Inman News that explains why this is happening. Check it out, Clink link at the bottom for the full article. Thanks Aaron
An excellent report published by Zillow’s Svenja Gudell documents the large number of U.S. homeowners who are still underwater, owing more on their mortgages than their homes are worth. While down from the peak of 31.4 percent in 2012, 18.8 percent of homeowners are in a negative equity positionEqually problematic, as the report points out, is that many homeowners who have escaped from being underwater are barely treading water: 36.9 percent of homeowners with a mortgage are “effectively underwater,” according to Zillow, since they simply don’t have enough equity in their homes to consider selling the property and moving up to a new, larger house.
New-home construction hasn’t recovered
New-home inventory has improved marginally since bottoming out in 2012, but is still nearly at the lowest levels in the 40 years that this information has been reported, according to NAHB data compiled by Calculated Risk.
Current inventory levels are roughly half of what there would be normally, and about a third of what they were at the peak in early 2007. Builders overbuilt as the housing boom passed its peak, and stopped building almost entirely when faced with the daunting task of trying to compete with their own recently built inventory that had been foreclosed on and was now available to buyers at a significant discount. Builders shifted their strategy towards building fewer new homes, but larger and more expensive ones.
Foreclosure activity has slowed
Distressed homes made up a significant part of the home sales inventory, peaking with the sale of over 1 million lender-owned properties in 2010. But foreclosure activity has been slowing down for the past few years.
A recent report from RealtyTrac notes that foreclosure starts have declined for 22 consecutive months. Foreclosure activity, while still between two to three times higher than normal, is at its lowest levels since 2006, and running at about 50 percent of where it was at the peak.
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