Tuesday, June 28, 2011

New Report: Home Values Falling Faster In Lower End

According to this video lower end homes are falling faster in value over the middle price range (move up) and luxury brackets.
Do you find it interesting that home values are falling faster in the lower end?  (Maybe the word isn’t interesting…its maybe…’suspect’?)
The belief is that the lower end home sales are subject to first time buyers who can’t scratch up a downpayment and/ or meet today’s overly strict lending requirements.
But, I am thinking there is another reason. REO inventory. Specifically, lenders are focused on selling their lower end assets now…because the losses from those sales is SMALLER vs. the more expensive homes. Sean O’Toole from ForeclosureRadar has been making the argument that the lenders are selectively foreclosing….going after lower end homes and the homes that have the least associated loss. In some cases, if the owner has equity and is in foreclosure Sean has proven the lenders will fast track their foreclosure. Vindicate the lenders all you would like (after all, its trendy!) but, if you were the bank you would do the same thing.
So, are the lower end homes lossing value faster because of fewer qualifying buyers or are the losing value because there are simply MORE lower ends for sale. Supply and demand.
You tell me…watch this video and share your thoughts.
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Lisa Ekanger Your Hometown Realtor!

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