Housing Crash: Foreclosure increasing

RealityTrac has a great map of USA with where the foreclosures are taking place. Click for it details.

We're just getting started since various ARM resets will take place over the next 4 years, and as these loans resets, people will find that they cannot pay their mortgage. That is, it's one thing to see a rise of few dollars or even $200, but when it resets at 50% or 100% of current payment, then it seems impossible and people have been and will continue to abandon their mortgages. And, if these reset charts are any indicator, things are going to get ugly for the next few years.

Keep in mind that foreclosure process takes months if not years to go through (and doesn't help when politicians put out moratorium to halt foreclosures -- the pain is delayed and made worse in the long run).

Some think that rents will go up with rising foreclosures but that's a mistaken notion. People will return to their parents or double up with their relatives (siblings, children, grandparents, etc.) -- so the demand will decline. The foreclosed homes will eventually turn into rentals. People who cannot sell their homes will turn into rentals. Which means that rental supply will increase (along with lowered demand), and all this will translate into seeing the rents get lower and lower.

The coming recession/depression will not be pretty, in my opinion....

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