The Minnesota Home Ownership Center has been tracking pre-foreclosure notices received by foreclosure counseling agencies throughout Minnesota and just posted some updated charts that show 2010 pre-foreclosure notices are consistently higher than the same time frame in 2009. Through June 2010, notices are up a considerable 20%:
I don’t find these numbers very surprising: the lackluster economy isn’t providing the new jobs necessary to reduce unemployment and those who are unemployed can only afford to make house payments for so long. In a few weeks we should see HousingLink’s updated foreclosure report that shows how many properties went through sheriff sale. While it is clear those numbers will be higher than 2009′s, I am interested in seeing how they compare to 2008, which was Minnesota’s highest foreclosure activity year thus far. Given recent trends I wouldn’t be surprised if we meet or even rise a little higher than 2008′s numbers.
Twin Cities Region - New MLS Listings – 12 Month Rolling Average:
Any uptick in foreclosure activity is unlikely to have immediate impact in the home sale market because of the lengthy Minnesota foreclosure process and the time it takes banks to prepare those properties for resale. So we are likely to see an increase in new foreclosure (REO) listings in 2011 to account for this.
The other trend to watch for though is the increase in short sales that are successfully closing. June 2010 saw a 40% increase in short sale closings from the same month in 2009 and represented 11% of all sales in the Twin Cities in June, up from just 7% a year ago. As short sales close in higher numbers we may see fewer homes that receive pre-foreclosure notices go through sheriff sale and thus eventually less bank owned listings on the MLS.
