Monday, April 21, 2008

Idaho foreclosures down from February, up 85% from year ago

Nationwide the trend is still negative; inventories of new homes in Ada and Canyon counties are slowly declining.

The number of Idaho homes in foreclosure in March was down 15 percent from the previous month, raising hopes that defaults may be ebbing.

RealtyTrac Inc., an Irvine, Calif., company that tracks the number of foreclosures nationwide, reported Tuesday that there were filings against 657 Idaho properties in March. While down from February, that's still 85 percent ahead of the comparable month a year ago.

A separate report last week said Idaho homes in foreclosure are now reaching the auction stage in massive numbers. But auctions by trustees follow initial foreclosure filings by several months, and as the number of foreclosures declines, the number of trustee sales is expected to follow suit.

The decline is most noticeable in the Treasure Valley. Ada County had 226 foreclosure filings in March, a 21 percent drop from 286 in February. Canyon County had 162 filings, down 24 percent from 212.

"It could be a sign that we could be getting close to the bottom," said RealtyTrac spokesman Daren Bloomquist. "But it's hard to tell after just one month."

Nationwide, the trend is still negative. RealtyTrac said 234,685 properties were in some stage of foreclosure in March, a 5 percent increase from the previous month and 57 percent higher than March 2007.

Idaho's foreclosure problem is being driven by subprime mortgages made at the height of the Treasure Valley building boom, said Marc Lebowitz, executive director of the Ada County Association of Realtors.

Research by the National Association of Realtors shows that the foreclosure inventory in Idaho for prime mortgages moved from 0.34 percent of all loans in the third quarter of 2007 to 0.42 percent in the fourth quarter, Lebowitz said . For subprime mortgages, foreclosure inventories increased from 3.78 percent to 5.08 percent of all loans serviced in the state.

Boise River Properties, a local real estate brokerage, expects to see fewer foreclosures now that the boom is over and buyers are not being encouraged to use exotic financing to buy more house than they can afford.

Caron blamed the foreclosure boom on lax lending practices and individual buyers and investors who used 100 percent financing to buy homes that were anywhere from $110,000 to $200,000 more than they could afford.

"Houses in the $250,000 range are moving," Caron said. "And we're talking with banks who work with developers, and they will finance houses in that range. And when you consider that the average two-income family in the Valley is $56,000, $250,000 is what they can afford."

He said the idea that there are "super bargains" to be had at auction sales is "non-existent." A bank with a home with an assessed value higher than the amount owed on the property will take the property back and hope to get most of its money back when the market ultimately rebounds, he said.


Shaun Tracy, an associate Realtor with Re/Max Capital City said the number of newly constructed homes for sale in Ada County has fallen from 1,594 on Feb. 6 to 1,252 as of Monday.

"That's good for the (overall) inventory of new homes because builders are not adding to that number," Tracy said. "As long as they don't do that, then it (the inventory) should eventually come back into balance."

The same is true in Canyon County, where the number of new homes on the market has fallen from 713 on February 8 to 633 on Monday, Tracy said.

"The numbers are decreasing," Tracy said. "Not by leaps and bounds, but they are decreasing."

Wednesday, April 16, 2008

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Valley home sales drop 37% in first quarter, Average prices are down as inventories bulge to 12%.

First-quarter 2008 Treasure Valley single-family residential home sales plunged 37 percent from a year ago, according to industry statistics released Friday.
Experts said many homes that were sold in the last quarter of 2007 closed in the first quarter of 2008, but not enough to rescue the quarter.

"That tells you how dismal the first quarter of 2008 really was," said a real estate agent at John L. Scott Real Estate.

The Intermountain Multiple Listing Service, which tracks home sales, reported that 1,651 homes changed hands in Ada and Canyon counties from January through March, compared with 2,605 for the same period a year ago.

"I'd say that in the 14 years I've been selling real estate in the Treasure Valley, I don't think I've seen numbers as pitiful as they seem to be be," said an associate broker with Re/Max Capital City. "Things have slowed to such a crawl that a lot of Realtors, lenders and builders are not going to make it in this environment."

He knows of a couple who are both Realtors and who have just one sale between them this year. "And this is beginning to look like the new normal for now," Tracy said.
Median home prices have taken it on the chin, too.

In Ada County, the median price for a single-family home in March was $210,000, up from $205,000 in February, but down 7 percent from $224,900 in March 2007.
Canyon County's median price of $149,900 last month was down 2 percent from $152,990 in February and down 7 percent from $163,300 in March 2007.

However, median prices in both counties were still well above 2004 levels. Ada County's median price in March was 38 percent higher than the $151,881 recorded for the same month in 2004, while Canyon County's was 43 percent above the March 2004 median of $104,345.
Meanwhile, the bulging inventory of unsold homes remains a problem.

According to MLS statistics, there were 7,195 homes listed for sale in Ada and Canyon counties at the end of the first quarter, about 12 percent more than the 6,448 listings at the end of 2007.
Buyers continued to search for bargains below the $200,000 mark. Among the hot spots for sales in Ada County were the 138 sales in the Southwest Boise/Meridian area, where the median price of a home was $198,000. The Boise/Garden City area had 121 sales, with a median price of $190,000.

Scott Gray, also with Re/Max Capital City, said he is seeing more interest in Boise properties as the price of gasoline keeps rising. "It's getting a little more costly to commute to Boise," Gray said.

Another problem, he said, is that bankers have become more stringent in their lending practices, even for potential homebuyers with good credit. He speculated that as banks get back on their feet they will be more likely to start making home loans again. The second quarter will give a better indication of how the rest of 2008 will go, he said.

"There is a lot of pent-up demand out there," he said. "But people have been sitting on the fence because they were afraid that home prices would go down even further, or because they couldn't qualify."

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