Real estate agent Kirsten Jordan breaks down the challenges homebuyers face and shares her predictions for the housing market in “Cavuto: Coast to Coast.”
Home foreclosures rose again in May as Americans continue to foreclose Cost of living crisis.
That’s according to a new report from real estate data provider ATTOM, which found that there were 32,621 foreclosure filings in May, including notices of default, scheduled auctions and bank foreclosures — up 3% from a year ago but down 7% from the same time last year.
“May’s foreclosure activity highlights subtle shifts in the housing market,” said Atom CEO Rob Barber. “Foreclosure starts increased slightly, while completed foreclosures declined, signaling stronger resilience in certain regions.”
Nationwide, about one in every 4,320 homes had a foreclosure filing in May, according to the report. But the situation was much more dire in some states. New Jersey had the highest foreclosure rate last month, with one in every 1,939 homes receiving a foreclosure notice, more than double the national average.
Rents have stagnated, suggesting high inflation may continue
April 16, 2024, Homes in the Issaquah Highlands neighborhood in Issaquah, Washington. (Photographer: David Ryder/Bloomberg via Getty Images/Getty Images)
In Delaware, there was a foreclosure filing registered for every 2,595 homes, in Connecticut there was one foreclosure filing for every 2,600 homes, and in Florida there was one foreclosure filing for every 2,638 homes.
The problem could quickly get worse. Rising house pricesRising mortgage rates, property taxes and insurance costs are hurting Americans.
Rising home prices and mortgage rates have made home affordability the worst it’s been in decades, which combined has caused the average salary needed to own a home to rise to $106,500 nationwide — a staggering 61% increase from the $59,000 needed just four years ago, according to Zillow.
There are several causes for the housing price crisis.
Years of under-construction created a nationwide housing shortage, then soaring mortgage rates and rising costs of construction materials made the problem worse.
Why can’t I find any homes for sale?
The supply of homes available for sale remains 34.3% down from normal levels before the COVID-19 pandemic began in early 2020, according to a separate report from Realtor.com.
A display home in the Cold Spring Barbera Homes neighborhood on November 8, 2023 in Loudonville, New York. (Angus Mordaunt/Bloomberg via Getty Images/Getty Images)
Rising mortgage rates over the past three years are also creating a “golden handcuff” effect on the housing market: Sellers who locked in record-low mortgage rates of 3% or less at the start of the pandemic are becoming reluctant to sell, further restricting supply and leaving eager would-be buyers with few options.
Economists predict mortgage rates will remain high into 2024 before starting to fall. Federal Reserve Interest rates are likely to rise until the Federal Reserve starts cutting them, but even then they’re unlikely to return to the lows seen during the pandemic. Plus, a series of higher-than-expected inflation reports at the start of the year have investors skeptical about the Fed’s ability to raise rates this year.
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Mortgage buyer Freddie Mac said Thursday Average interest rate for a 30-year loan It fell to 6.95%, down from a peak of 7.79% in fall 2023 but still significantly higher than the pandemic-era low of just 3%.
A majority of homeowners say they would be nearly twice as willing to sell their home if their mortgage interest rate was 5 percent or higher, according to a separate Zillow survey. Currently, about 80 percent of mortgage holders have interest rates below 5 percent.
