Good Time For A Flood
There is no correlation drawn here between foreclosure flood and the history of rising prices. Given his data, there SHOULD be a foreclosure flood to put banks in a position to profit if history repeats! From dsnews.com:
Investors who are eagerly waiting for bargain prices from the potential foreclosure flood are likely waiting for something that won’t happen, according to the September home value forecast report from Pro Teck Valuation Services.
In the report, the company explained why it believes there will be no such flood.
“With regard to the U.S. foreclosure inventory, there has been a misperception that it is a problem for the entire market. In fact, it is quite concentrated in specific cities and neighborhoods,” said Tom O’Grady, CEO of Pro Teck Valuation Services. “For this reason, potential buyers who have been waiting for bargain prices in desirable neighborhoods may be disappointed.”
Instead, the report focused on the current lack of inventory in San Diego, Orange County, and Los Angeles. Overall, Pro Teck found that all three areas have less than 5 months of remaining inventory left.
“This is significant because in the Los Angeles market over the past 25 years, whenever this indicator was below five months, the median price increased by close to 19 percent the following year. Of course, it remains to be seen if the same appreciation happens again,” said O’Grady.
The report also analyzed price per square foot and months of remaining inventory in the three areas and found that the lowest priced areas have the lowest levels of inventory.
The report included a list of the 10 best and worst performing metros based on the company’s market condition ranking model. The list of the top performing markets is based on a several indicators, such as changes in sales, foreclosure sales, prices, and inventory.
The reported noted that one common characteristic of the top markets is they all have experienced significant declines in active listings over the past year.
Oxnard-Thousand Oaks-Ventura, California
San Diego-Carlsbad-San Marcos, California
Los Angeles-Long Beach-Glendale, California
Santa Ana-Anaheim-Irvine, California
Houston-Sugar Land-Baytown, Texas
Fort Worth-Arlington, Texas
Austin-Round Rock-San Marcos, Texas
San Antonio-New Braunfels, Texas
New Haven-Milford, Connecticut
Bridgeport, Stamford, Norwalk, Connecticut
Augusta-Richmond County, Georgia-South Carolina
Rochester, New York
New York-White Plains-Wayne, New York-New Jersey
Edison, New Jersey
Nassau-Suffolk, New York
Newark-Union, New Jersey-Pennsylvania