Foreclosed Home Rates Not Going Down Anytime Soon

by on Foreclosure Rates

A national study of the foreclosure market showed that the metropolitan area of Kansas City in Missouri experienced a decline in foreclosure activity in the first six months of the year.

According to the study, out of 122 properties in the area, one received a foreclosure filing and was at risk of becoming a foreclosed home, representing .82 percentage point of the total.

Overall, Kansas City is better off compared with other cities with populations of not less than 200,000, earning it the 86th position in the ranking of metropolitan areas nationwide.

Although some real estate professionals have confirmed the downward trend in foreclosure activity in the city, they are quick to point out contrasting results of other market reports.

Another report indicated that the number of foreclosure properties in the Kansas metropolitan area rose last month, compared with June a year ago. This report examined active mortgages as against the overall number of households.

According to the report, nearly 1.3 percent of the total outstanding mortgages were foreclosed last month, compared with nearly 0.8 percent foreclosures in June last year, showing a difference of about 0.5 percent.

The number of foreclosed home auctions gave credence to the reported foreclosure increase. A recent auction showed 88 foreclosed houses across western Missouri sold, generating sales of $3.9 million.

Greater Kansas City Housing Information Center executive director Patricia Gilmore-Wilkins said that many distressed borrowers continue to struggle financially, adding that there is no decline in the number of homeowners requesting for the center's services.

Industry experts said that the decline in foreclosure rates presented by the first market report was due to the reluctance of lenders to foreclose because the process takes a lot of time and can be costly.

They said that currently, lenders are more cautious when it comes to repossessing distressed properties. However, they expect some forthcoming changes in the housing market by way of another surge in the number of foreclose houses by the end of 2009.

Greater Kansas City Local Initiatives Support Corp. executive director Julie Porter said that bank foreclosed homes will start flooding the market again, and this time, the trend would be driven by unemployment.

She said that foreclosed properties in urban neighborhoods will not slow down due to the poor situation in the jobs market.