RealtyStore Foreclosure Blog

Weakened by the worst credit crisis in the nation’s history, the Top 25 Housing Predictor real estate markets in 2008 are showing signs of erosion. The once top rated market is beginning to run out of gas and has fallen from its #1 position and many of the other markets have changed.

Housing Predictor annually issues its Top 25 markets forecast the beginning of the year, and updates the forecast at midyear. But the update is being made earlier than usual this year as a result of a national housing market climate that has seen sales slow even more than forecasters expected. The ripple effect of tighter mortgage standards and increasing inventories of homes and condos on the market for sale are to blame.

Record high levels of foreclosures also account for drastic changes in many housing markets. Many markets have already deflated more than 50% in value from the boom’s peak. The Top 25 markets have the highest likelihood of hitting their forecast appreciation by year’s end, despite a growing belief that the economy is in recession and the majority of housing markets throughout the country are suffering from real estate depressions.

Housing Predictor forecasts more than 250 local housing market futures in all 50 U.S. states and provides independent unbiased analysis on market conditions. The top markets are scattered all over the U.S. Only four states have placed three markets on the list. Utah, Mississippi, Texas, New York, Oklahoma, Idaho and North Dakota placed markets on the leading list among other states.

Conservative North Dakota with one of the strongest statewide economies nationally, and the least subprime mortgage activity in the country, placed three cities on the list. However, neighboring South Dakota, damaged more substantially by the subprime mess failed to place any markets in the top.

Housing Predictor also provides breaking real estate news. Find your market forecast, search new listings and foreclosures at http://www.housingpredictor.com

RealtyStore (www.realtystore.com), the nation’s leading provider of foreclosure listings, released its quarterly Nevada Foreclosure Report.

RealtyStore.com recorded 17,307 notices of default (NODs) statewide for Q1 2008. This was a 32% increase from those recorded in Q4 2007 and a 139% jump over Q1 2007. An NOD is filed by the lending institution, when a homeowner falls behind on mortgage payments. NODs provide important information about which homeowners have home loans they cannot afford. Nevada has maintained the nation’s highest foreclosure rate for nearly two straight years. For Q1 2008, 1 out of every 52 households in Nevada received a default notice, which is more than 7 times the national average.

“For almost two years running, Nevada has been plagued with the highest foreclosure rate in the nation. This is a result of the dramatic increase in speculative building starting in 2004 when home prices soared 47%,” said Tim Chin, CEO of RealtyStore. “Now, as the housing market corrects, investors are running for the hills as inventory mounts and prices rapidly decline.”

More than 90% of the foreclosures in Nevada are occurring in Clark County. Clark County, home of the gaming capital, better known as Las Vegas, started off the first quarter with 15,876 defaults. This was more than double the 6,651 default notices for Q1 of last year. The foreclosure problem in Las Vegas resulted from home buyers gambling on prices continuing to climb. Speculators used adjustable-rate-mortgages (ARMs) and sub-prime loans to get their foot in the door hoping to use the home’s projected appreciation to later refinance under more affordable fixed-rate loans. Unfortunately, the tide turned and Nevada’s housing market has crumbled.

With a huge wave of hybrid ARMs due to reset this spring, many Nevada homeowners will find their payments ballooning by as much as 50%. With property values dropping almost 20% since last year, distressed borrowers will have little opportunity to refinance into more affordable loans. Left to drown in their mortgage payments, an increasing percentage of homeowners will enter the foreclosure process. This will further suppress housing prices as bargain-priced foreclosures take a bigger share of the Nevada home sale market. In Las Vegas, nearly half of all homes currently on the market are foreclosures. With inventory increasing and home sales at their lowest levels in 13 years, the Nevada housing market will get worse before it gets better.

About RealtyStore.com: Founded in 2005, RealtyStore.com is the fastest growing, most trusted provider of foreclosure listings and information in the nation with over 1 million pre-foreclosure, foreclosure auction, bank-owned, and tax sale property listings. Collected from hundreds of public and private sources, RealtyStore’s proprietary database includes extensive property characteristics (including pictures and maps), default and tax information, comparable home values, and neighborhood demographics information. For more information, visit http://www.realtystore.com.