Misleading loan practices, unethical agents, and even worse bankers, compiled on top of the deficient California real estate laws have left the state’s residential markets in utter devastation. Congress has acted upon California’s distress by passing legislative acts to help out struggling home owners. The most popular of them being President Barack Obama’s website, obamahelpforclosures.com, and the home recovery act website, homercovery.org.
The Center for Responsible Lending( http://www.responsiblelending.org/mortgage-lending/tools-resources/factsheets/iowa.html), an organization committed to protecting home ownership and family wealth, put the state of California’s 2010 foreclosure projections, for the years 2009-2012, at 1,888,716. California has projected almost 2 million foreclosures in the state, although the number of foreclosure sales is much smaller, reaching only 310,920. California’s foreclosure inventory, when considering its projection rates, is still low, reaching 304,082, at the end of 2010’s first quarter. Using the time frame of the past 4 years, 2006-2010, California has had an overall 415% increase in foreclosure starts. Statistics that are hard to look, even if you don’t live in CAlifornia.
California’s total past due mortgages is another heart break, altogether. When looking at the numbers for the first quarter of 2010, it’s easy to see how they came to those sky-high foreclosure projections. When the first quarter of 2010 came to a close California posted 944,081 past due mortgages. The state contains just under 37 million people, a number that may help, if it were possible to determine tax paying, home owning citizens from those flying under the immigrant radar. California has calculated a deep change in foreclosure starts.
As the result of all these drastically changing factors, the average loss, per home, in California was a whopping $51,174, which was some of the worst hit real estate markets in the country. The total loss of wealth due to California’s foreclosures, across the years, 2009-2012, is projected to be in the range of $627 billion. For California to overcome this financial hump, a real estate miracle would have to occur, or several decades of continued residential market growth. There’s a long hard road ahead of almost all of California’s real estate agents.
The Impact of Poor Lending Techniques in Nevada
Nevada has had it the worst out of much of the western parts of the country. The state has suffered an indescribable rise of foreclosures. Between the years of 2006 to 2010, Nevada foreclosures have risen into outerspace with a 1,246% increase. At the end of the first quarter of 2010, Nevada had experienced, 146,512 foreclosure starts, spanning only 2 years.
Over the same period of time the state only sold 50,277 of the homes that began foreclosure, leaving Nevada with a inventory of over 57,094 foreclosed homes in their pocket. The annual loss per home, recorded by the state, was an astounding $54,676. Overall, Nevada residential real estate put together a total loss of 54.4 billion. If California doesn’t start letting banks control the lending, instead of misinformed legislation, then all those past due mortgages are going to bite them in the rear, even harder than it is, now. California holds 133,952 past due mortgages. To all real estate investors whom might be concerned, a big investment in Nevada real estate may not be the best decision, for the next few years, but if one were forced to choose which of these two states to invest in, it would be a tough decision, one that should be left to the individual investors local research.