Jump to content
House Price Crash Forum
Sign in to follow this  

Flood Of Foreclosures Coming In The Us

Recommended Posts

The first linked worked.

Seems that banks are cashing in their repossessed chips, I wonder why? :lol: Also a lot of the newer loans from the last 18 months have gone bad. Could it be that people saw what they thought was a bargain, but as house prices didn't go up there was no money in it?

That looks like over here and now.

I wonder if we really are about 18 months behind the USA.

Thanks. ;)

Share this post

Link to post
Share on other sites

They held back foreclosures, in anticipation of bailout money.

Bailout money will stop and is not unlimited.

So they now have to race to get rid of foreclosed stock before it loses value before all the other competing banks stock is released. The longer the bank has it on the books, the more it it can get damaged if left empty.

Share this post

Link to post
Share on other sites

Could this be the next trigger for a global wave 2 downturn?

What would be a gentle organised trickle of properties onto the market, suddenly becomes a stampeed for survival.

Edited by Pseudo Lord Sandwich

Share this post

Link to post
Share on other sites

Re cover ye..rselff


Commercial Mortgage Defaults Jump for U.S. Banks

By Hui-yong Yu

Aug. 31 (Bloomberg) -- The default rate on commercial mortgages held by U.S. banks more than doubled in the second quarter from a year earlier amid falling rents and occupancies for malls, office buildings and warehouses.

Loans that were 90 days or more past due climbed to 2.88 percent of outstanding balances in the second quarter, from 1.18 percent a year earlier, according to New York-based property research firm Real Estate Econometrics LLC. Defaults increased from 2.25 percent in the first quarter.

“A delinquency may have resolved itself two years ago,” said Real Estate Econometrics President and Chief Economist Sam Chandan. “Today, even one missed payment may be more indicative of an underlying problem, so banks have to be very proactive in addressing the issue.”

Banks held $1.087 trillion of commercial property loans in the quarter, up from $1.077 trillion in the previous three months. That’s almost 15 percent of all loans and leases held by banks, Real Estate Econometrics said. Defaults are rising both for lenders who hold commercial mortgages and for bondholders in the $700 billion U.S. market for securities backed by commercial mortgages.

The CMBS market accounts for about 22 percent of the nation’s $3.4 trillion in commercial real estate debt, according to the Real Estate Roundtable. Defaults and late payments on loans bundled into CMBS could surpass 7 percent by the end of this year, research firm Reis Inc. said on July 30.

Falling Behind

Banks are beginning to recognize that more past due commercial property loans are unlikely to be paid in full. Commercial mortgages labeled as “non-accrual” more than doubled in the second quarter from a year earlier, to $27.76 billion, according to Real Estate Econometrics. The figure reflected a 31 percent increase from the previous three months.

Commercial defaults will rise to 4.1 percent by year’s end, a rate last seen in 1993, according to Chandan’s forecast. Overdue commercial property loans reached 4.6 percent in 1992 during the savings and loan crisis, when the U.S. created the Resolution Trust Corp. to sell off real estate and non- performing mortgages held by insolvent lenders.

This year’s first-quarter default rate was the highest since 1994, Real Econometrics said.

The credit crisis and recession mean lower occupancies and rents for apartment buildings, offices, shopping malls, warehouses and hotels.

Apartment Defaults

U.S. apartment vacancies may rise to 7.8 percent by the end of this year and break the record 8 percent in 2010 as unemployment worsens and the supply of new apartments increases, according to New York-based Reis.

The default rate on bank-held mortgages for apartment buildings climbed to 3.13 percent in the second quarter from 1.20 percent a year earlier, according to Real Estate Econometrics.

A loan is delinquent when it’s 30 to 89 days past due and in default when 90 or more days late.

To contact the reporter on this story: Hui-yong Yu in Seattle at hyu@bloomberg.net

Last Updated: August 31, 2009 16:04 EDT

Edited by Crashman Begins

Share this post

Link to post
Share on other sites

According to MSNBC, the banks in the US are about to start releasing their shadow inventory onto the market.



Having another go at embeding!

Nope didn't work again, anyone know how to embed a clip here?


I can do better than that. We have a place in Florida that we rent. L/L went t!ts up last year and we have paid NO RENT to the new L/L (the bank) sincnot kiddin I have posted this before. Lo and behold we had a phone call this morning from the bank asking if we were interested in buying at $120K. This a for a three bedder near Disney. Old L/L bought it for $280K. There you have the market in all its glory. BTW you can buy a similar property under the government FTB scheme (been trashed a bit) for $90K. Great this crash innit? Coming to a cinema in the UK soon.

Share this post

Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   291 members have voted

    1. 1. Which of the Prime Minister's options would you choose?

      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.