Bellevue Real Estate » Distressed

Distressed Inventory Report 9-4-10

George Thurtle — Tue, 07 Sep 2010 15:24:17 +0000

I did something I haven’t done for a while and that is take some time off. As a result I am just posting Saturday’s inventory report today. There is a definite change in the trend. The Notice of Trustee Sales (NTS) are up significantly. They had fallen for a while and I was suspecting that was due to the servicers who handle these things taking vacations but now it appears they are back in full swing. The other significant factor is that the overall number of distressed properties is down. As an example MLS Area 530 is down overall in distressed inventory from 195 homes to 186 homes. A month ago this number was 208 homes so that is over a 10% decrease. However this week alone there were 21 NTS in this market area but the signifact factor is that as new NTS come on they are being offset by reductions in the overall number. It can be inferred that there are number of short sales taking place since the number of foreclosed homes is not rising. This means these homes are either getting loan modifications or short sales are occuring.

What is interesting is the composition of the homes which are NTS. There is a lot of condiminium inventory. However in West Bellevue (WB) I am seeing a number of upper end $1,000,000 dollar plus homes which are now going NTS. So it is the high end and the low end of the market that is seeing the distress. As has been discussed earlier I think you will see more high end homes as the affluent who have resources are starting to drain those resources and are not seeing the bounce in their businesses or occupations occur in a more normal cycle. These people are having to make decisions that never would have to make.

The apreadsheet is here: Bellevue Foreclosure Report 9-4-10

Distressed Inventory Report 1-30-10

George Thurtle — Sat, 30 Jan 2010 15:56:11 +0000

The trend continues. East Bellevue (EB) had a big jump in overall distressed inventory which went from the 113 homes the week before to 123 homes this week. This week alone there were 8 new Notice of Trustee Sale (NTS) alone. It does look like the lenders are getting geared up to take these homes back. South Bellevue (SB) also saw an increase of total distressed inventory from 52 homes to 55 homes and this week 5 new NTS. Last week there were 4 new NTS. What is surprising is that there wasn’t a bigger jump in inventory given the new NTS. Things seem to keep selling but not as fast as the new NTS notices are coming through. West Bellevue was the exception. It saw a decrease from 51 to 55 homes. with the number of NTS overall being down. As a matter of fact customers I am working with are frustrated there is not more upper end distressed inventory. In WB there is only one bank owned home listed.

A disturbing trend is starting to emerge. The middle calss neighborhoods such as are in EB are really starting to take the brunt of foreclosures. The 98008 zip code in particular. The higher you go in price the less the problem and in fact in WB the problem appears to be easing. While I maintained the real estate recovery was going to be a top down recovery in this area, this is not good news overall. Something needs to be done to put people back to work. Our GDP increased 5.7% this week over the last quarter but compared to last year for the same quarter it was little increased but the most distressing part is that same GDP was created with about 3,000,000 fewer jobs. Shrinking our way to propserity will not work and eventually will cause the economy to begin contracting again. This is the message the stock market has finally figured out.

Here is the spreadsheet: Bellevue Foreclosure Report 1-30-10

Distressed Inventory Report 1-9-10

George Thurtle — Sat, 09 Jan 2010 16:37:42 +0000

Well it has begun. The Notice of Trustee Sales are up. Not a whole lot but I think the trend we discussed of lenders finally getting their foreclosure process in order to deal with the new requirements of contacting the borrower prior to any sale seem to be getting in place. You will see there was hardly any foreclosed inventory due to the Christmas and New Year Holiday occuring on Friday. The traditional days for the Trustee sales to occur. Expect to see these numbers pick up later in the month. I think by the first week in February we will see this play out and get a good idea of the overall distressed inventory trend for the Bellevue Home Market.

Click here for the spreadsheet link: Bellevue Foreclosure Report 1-9-10

Distressed Inventory Report 11-7-09

George Thurtle — Sat, 07 Nov 2009 16:20:54 +0000

There is a new trend developing and that is the NTS/Foreclosed (F) home ratio keeps falling but overall in East Bellevue and West Bellevue the distressed inventory keeps rising. Only in South Bellevue did the NTS/F ratiio fall and the inventory go down. As we discussed before a falling NTS/F ratio is a good thing because there are fewer distressed homes entering the system via short sale that feed the bank owned homes which is what comes out of the backside of the process. However to have a falling NTS/F ratio while the inventory increases overall is not a sustainable trend it has to break one way or the other. If the ratios start crawling back up while inventories keep climbing that will keep downward pressure on pricing and show a longer term downward trend. Overall distressed inventories going up despite the NTS/F ratio going down will put downward pressure on pricing but in that scenario it clears out the bank owned inventory and eventually the overall number of distrssed propeorties has to fall leading to firmer pricing.

This week in East Bellevue the overall distressed inventory is at its highest level since the August 15th report. At that time there was 91 overall distressed homes, like this week, however at the August 15th report 20 homes were foreclosed while 71 had notices of trustee sale. This week there is 43 foreclosed homes and 48 NTS homes. West Bellevue shows this trend even more. This week they saw their overall inventory of distressed property jump by three homes to 66 but their NTS/F ratio actually took a dive to .83. If this ratio keeps falling then logically it should mean an overall coming reduction of distrssed inventory. But there is nothing logical about our economy or market. We could be in this weird world where we are in a “trading range” of distressed inventory and the NTS/F ratio will oscillate. The next weird trend to surface might be seeing inventories fall and the NTS/F ratio climb which would mean we are stuck in this “trading range”. I think the above little antidote on our local real estate market is more symbolic of the overall economy where you have one person making a perfectly cogent argument why the sky is falling and another person can make a perfectlly good argument why the worst is over and happy days will be here agian next spring all off of the same data.

This is very confusing and makes my head hurt. However it does look like the buying window is opening a little wider and like last year where your best buys where Q4 and Q1 it looks like the same pattern is developing just a little milder cycle. So there you have it the upshot of the report is buy a home so I can make a commission.

Click on the link for the spreadsheet. Bellevue Foreclosure Report 11-7-09

Distressed Inventory Report 10-24-09

George Thurtle — Sat, 24 Oct 2009 15:49:32 +0000

Hello everyone. There is a new addition to the Distressed Inventory Report. By Popular demand I have added West Bellevue (98004) and South Bellevue (98006). Also the website is going to be expanded to be a Bellevue website as opposed just specializing in East Bellevue. Seems folks from the other neighborhoods would like to get the Stats for their markets. There is no historical record for these two new zip codes but as the weeks go by you will see the trend lines developing. However if you want to get an idea of a market’s overall direction without historical data look at the ratio of NTS/Foreclosure (NTS/FO). In general markets that have a large amount of distrssed inventroy will see many more NTS (Notice of Trustee Sale) than foreclosed homes. If you look at the East Bellevue historic numbers you see that on August 8th you have 90 homes total with an NTS/FO Ratio of 4.625. This means for every foreclosed home there was 4.625 NTS homes. Intuitively you can imply the amount of foreclosed homes rise because not all NTS homes will be successfully short sold or have their loans successfully renegotiated. Conversly as the ratio falls it means there is less potential NTS invetory which will be converted to a foreclosed bank owned home. If you look at the West Bellevue ratio of 1.0645 you can see that this is almost even because for every bank owned home there is only one short sale home. If you look at the West Bellevue numbers on the surface with 5 new foreclosed homes you would think wow what a big jump in bank owned inventory which is true. However what is really happening is that the overall distressed inventory is working down since there is a dwindling amount of NTS inventory to supply the foreclosure pipeline. From this I would make the argument that this market is actually in recovery with those borrowers or lenders throwing in the towel and taking the home back to dispose of it. The key factor is the overall distressed inventory not just the foreclosed homes. Home foreclosure is the cumulnation of an extended process for a borrower under extreme financial pressure. These foreclosures you see now reflect economic conditions put in place over a year ago. The NTS reflect borrower circumstances from about six months ago. In most markets the largest downward pressure on prices is not put on by the bank owned homes but the short sale homes. These borrowers are at the height of their economic distress and their main emphasis is to get a deal at any price to show a lender.

I will have more commentary on this week’s report a little later in the week but the interesting numbers for me were in East Bellevue on the listed MLS inventory which took a big jump. Looks like some of this short sale and foreclosed properties are finally coming to the market.

Click on the link for the spreadsheet. It is getting pretty large and I have added grid lines and color coding to help.
Bellevue Foreclosure Report 10-24-09

Distressed Inventory Report 9-12-09

George Thurtle — Sat, 12 Sep 2009 15:13:30 +0000

The dichotomy of increasing number of foreclosed homes and a decreasing number of homes with a notice of Trustee Sale continues. The number of foreclosed homes is at an all time high at 26. The most since the report began. The lowest it has been was 16 on the August 8th report. However the number of homes with notices of Trustee Sale is at an all time low of 50. In the same August 8th report that number was at its peak at 74. It looks like that some of the homes with notices of Trustee Sales are going to foreclosure.

However the good news on the flip side is that the number of overall distressed homes is at an all time low of 76 this is a big drop from the 88 the week previous. So some of those homes that were scheduled for a Trustee Sale are either selling or having their defaults cured through a loan modification or some other means. In addition it also appears that the local economy is stabilizing and very little new inventory is being brought to the market with only 1 new home showing for its notice of Trustee Sale this week. Some of those homes that had notices of Trustee sale appeared to have closed so mybe some of those pending short sales are starting to happen. We will see in the Weekly Scorecard on Monday. East Bellevue Foreclosure Report 9-12-09

Distressed Inventory Report 9-5-09

George Thurtle — Sat, 05 Sep 2009 15:31:33 +0000

The trend continues with the overall numbers of distrssed inventory holding steady just below 90 but with the number of forclosed homes increasing and the number of those with notices of Trustee Sales decreasing. The number of foreclosed homes is at an all time high since this Report started at 25. The number of Trustee Sales is at an all time low with 63. Looks like some of those short sales are starting to go together.

The big disconnect is the number of foreclosed homes at 25 and the listed “Bank Owned” homes in the NWMLS at 3. Some of this could be due to the agents not disclosing properly a property’s status. If I have time this weekend I could input the addresses of the bank owned homes in the NWMLS against the foreclosed homes of record and see what is really listed and what is not. This would help shed some light on the big disconnect between the very small number of bank owned homes listed and those of record. East Bellevue Foreclosure Report 9-5-09

Distressed Inventory Report 8-1-09

George Thurtle — Sat, 01 Aug 2009 22:02:46 +0000

Below is the updated inventory report. There appears to be no rise in distreesed inventory and a couple of homes have sold. There were no new forclosed homes and only two new notices of Trustee Sale. In general everything balances but in 98005 there were no new foreclosures but the foreclosed homes jumped by two.
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` Aug 1-09 July 26-09
98005
New Foreclosure 0 0
Foreclosed 9 7
New Trustee Sale Notice 0 2
Trustee Sale Notice 24 28

98007
New Foreclosure 0 0
Foreclosed 1 1
New Trustee Sale Notice 1 0
Trustee Sale Notice 15 15

98008
New Foreclosure 0 0
Foreclosed 7 10
New Trustee Sale Notice 1 1
Trustee Sale Notice 27 26

Total New Foreclosure 0 0
Total Foreclosed 17 18
Total New Trustee Sale 2 3
Total Trustee Sale Notice 66 69

Ratio of foreclosed/trustee sale 0.2576 0.2609

MLS 530 Bank Owned 3 2
MLS 530 Short Sale 27 21

Sorry for the funny formatting but still working on cutting and pasting XL into the blog format.