Rocky road ahead for the housing market, firm warns
More supply means more downward pressure on prices, the firm notes:
For a number of reasons, banks have not been aggressively taking title to homes and selling them, which has resulted in very few distressed sales in comparison to the actual level of distress in the market. This delay in REO sales, along with historically low mortgage rates and an $8,000 tax credit, has helped to stabilize the housing market - temporarily.
It is very clear that price stabilization is temporary unless something is done.
What sort of "massive supply" numbers are we talking about? Pretty, um, massive: One out of every 10 U.S. homeowners is behind on mortgage payments, John Burns Real Estate estimates. Not one in 10 homeowners with mortgages. One in 10 homeowners, period.
I keep hearing from local real estate agents that they're seeing foreclosed homes that haven't been put on the market yet by lenders. Is this true near you?