Realty Trac reported this morning that foreclosures fell by 14% for the month of February, a record decline, and are now at a 36 month low.
This has nothing to do with the fundamentals of the housing market improving, but the inability of the banks to process foreclosures because of the fraudulent mortgages clogging the system.
This slow down will just delay the eventual recovery for home prices, as prices will only bottom when the flood of foreclosures are allowed to enter the market.
When will this day come?
Michael Feder, chief executive officer of Radar Logic Inc, disusses the topic with Bloomberg below. His analysis:
"We are terribly concerned with what is ultimately the pain hast to be taken. The number could approach aggregate mortgages 5 or 6 trillion dollars. The question is how much of that is overhang and how much of it has to be written off."
"NAR says based on inventory and absorption rates we have little over 8 months supply. The reality which you add up all the houses for sale, houses vacant not yet on the market, houses underwater, seriously delinquent, in foreclosure, almost in foreclosure, the number is closer to 60 months, 5 years"
"Who is going to absorb the foreclosed homes?"
I hope to be someone to absorb some of the foreclosed homes. After supply meets demand, and prices collapse down to fair market value.