Amidst the pandemic, only a few foreclosures are only expected by most experts to happen in the real estate market today. What are the details that made the experts in the said market say this?
How Foreclosures Would Be Fewer Amid the Ongoing Pandemic Today
A foreclosure sign sits in front of a home for sale April 29, 2008 in Stockton, California. As the nation continues to see widespread home loan foreclosures, Stockton, California led the nation with the highest foreclosure rate. One out of every 30 homes in Stockton is in foreclosure, close to seven times the national average for a metro area in the U.S.
There are few reasons as to why the real estate market would have few foreclosures, instead of having more, amidst the threat of COVID-19 pandemic. According to East Bay Times, there will be still some foreclosures in the real estate market, however, it will be few and far between. The public shouldn't worry, as they are saying that it won't be the same that happened during the real estate market's housing market bubble burst from 2006 to 2007.
But worry not, as they are seeing a rebound in the said market, especially in the upcoming year of 2021. There are several reasons as to why a possible growth rebound will highly happen in the market, which is listed below:
- Increased property sales.
- Increased property prices.
- Having a high demand in the market.
Do take note that the demand for homes located in most suburban areas is highly increasing. This is along with the demand of second-hand housing markets from both renters and homebuyers alike. They have noted that homes that are larger and with more rooms are highly sought after by the public in the said market.
Thanks to the assistance provided by the government, in the form of government-mandated forbearance, have allowed most of the homeowners to have more time to meet their payments for their home payments. This results in good news, as there are only a few of them struggling to keep their homes. This is thanks to the following factors:
- Having low mortgage rates.
- Consumers having strong savings.
- Prices for homes are rising.
When compared to the previous cases of foreclosures from 2008 to 2012, there is a huge notable difference between then and now. They have noted that during those years, the foreclosure rates have been recorded at a 4% increase, a record-high increase in the market's history. Thankfully, experts today are seeing that the said rate wouldn't go above 1.5% to 2% tops.
Other Notable Reasons as To Why a Housing Market Fallout Isn't Possible Today
Aside from the mentioned factors and reasons above, there are other things experts say that would be the solid reason as to why the market will be stable. According to The Orange County Register, the reason why the housing market wouldn't crash again and foreclosures will be low in number is that most homeowners have home equities. This is due to most of them having their mortgages being owed
Additionally, this gives more options to homeowners nowadays, even if they lose their home due to the pandemic. And due to that pandemic, they can easily sell their housing property, especially for those properties located in the suburbs and rural areas.
Although most experts highly agree that foreclosures will be record low for the meantime, the real question would be is that when and how big the next wave of foreclosure would hit the housing market sector in the real estate business.
ALSO READ: 6 Tips on How to Buy a Foreclosure & Understanding the Stages of Foreclosure
