Today's foreclosure rate is nothing like the real estate housing market crash of '08. Have questions? Get in touch - (404) 410-6465 or visit www.completerealtyteam.com/.

Foreclosure Rates: The Massive Change from 2008 to Now

You've probably read stories regarding the rising number of foreclosures in today's housing market. That may raise a few questions for you, especially if you're considering purchasing a home. Understanding what they truly imply is crucial if you want to know the truth about what is going on right now.

According to ATTOM, a property data supplier, foreclosure filings are up 6% from the previous quarter and 22% from a year ago. As media headlines draw attention to this surge, reporting on the number alone may cause concern and possibly make you reconsider purchasing a home for fear of a price drop. While foreclosures are on the rise, the data demonstrates that a foreclosure crisis is not on the horizon.

Let's take a look at the most recent data in context to see how it compares to past years.

It's Not the Dramatic Increase That Headlines Lead You To Believe

The number of foreclosures has been at an all-time low in recent years. This is because, in 2020 and 2021, the forbearance program and other homeowner relief choices enabled millions of homeowners to stay in their homes, helping them to get back on their feet during a difficult time. And, with property values soaring at the same time, many homeowners who might otherwise have faced foreclosure were able to leverage their equity and sell their homes rather than face foreclosure. Equity will continue to be a factor that can help keep folks out of foreclosure in the future.

As the government's moratorium expired, foreclosures were projected to climb. However, just because foreclosures are on the rise does not imply that the housing market is in jeopardy. According to Clare Trapasso, Executive News Editor at Realtor.com:

“There’s no reason to panic, at least not yet. Foreclosure filings began ticking up . . . after the federal foreclosure moratorium ended. The moratorium was enacted in the early days of COVID-19, when millions of Americans lost their jobs, to prevent a tsunami of homeowners losing their properties. So some of these proceedings would have taken place during the pandemic but got delayed due to the moratorium. This is a bit of a catch-up.”

Basically, there will not be a rush of foreclosures. Instead, some of the rise is attributable to the above-mentioned delayed activity, while the majority is due to economic conditions. As ATTOM CEO Rob Barber explains:

“This unfortunate trend can be attributed to a variety of factors, such as rising unemployment rates, foreclosure filings making their way through the pipeline after two years of government intervention, and other ongoing economic challenges. However, with many homeowners still having significant home equity, that may help in keeping increased levels of foreclosure activity at bay.”

While foreclosures are on the rise, it is evident that current foreclosure activity is nothing like it was during the housing crisis of 2008. In addition to the causes described above, this is largely due to the fact that home buyers now days are more qualified and less likely to default on their loans.

Foreclosures are now considerably below the all-time high reported when the housing market fell.

Summing It Up

Putting data into perspective is more crucial than ever right now. While foreclosures are projected to climb in the housing market, they are nowhere near the crisis levels observed when the housing bubble burst, and this will not result in a drop in home prices. So if the housing market somehow does crash, it won’t be from an abundance of foreclosed homes.

If you want to buy or sell a home in Cobb County or the Atlanta area or just have questions, please don’t hesitate to get in touch with us!

Complete Realty Team
Ken Mandich - REALTOR®
Phone: 404-410-6465
Main Site: www.completerealtyteam.com/
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Email: admin@completerealtyteam.com

Brokerage:
ERA Sunrise Realty
David Moody - Broker
Office: 678-781-7400
Email: david.moody@era.com

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