U.S.: real estate still depressed
When he bought his house in August 2006, Michael B, 42, is confident in the future. He just got married and earns his living as comfortably as mortgage broker for Guild Mortgage, a company based in the South Bay, affluent suburb southwest of Los Angeles. The housing market is in full intoxication. It has reached exorbitant prices unrelated to the quality of buildings. Due to earthquakes, all buildings here are made of wood and thus condemned the attack of termites and demolition few decades later.
In South Redondo Beach, where Michael and his wife decided to buy a two bedroom townhome without a seal, it is impossible in 2006 to find housing for less than $ 500,000. They pay them 732,000 dollars."I was spared," says Michael, but I decided to keep my money rather than making a contribution. "Their monthly payments therefore amount to $ 5,500. "An expenditure authorized by high but my income," he adds.
Four years later, the savings have shrunk. And Michael and his wife, now parents of a boy two years, are on the verge of losing their homes. A year ago, they stopped paying their mortgages. "In 2007, we have been hit hard by the housing crisis. My earnings have dropped 75%. "The three-piece is only worth 550,000 dollars.
After a year of negotiations with its bank, Michael has finally won the right to make a short sale (that is to say, sell his home at a price less than its mortgage). He could have chosen a foreclosure, easier to manage. "But it would have prevented me from getting a loan for seven years.With a short sale, the credit we are prohibited for two years! "
The worst is not past
After an upsurge in real estate transactions due to tax credits of $ 8,000 offered until 30 April by the Obama Administration, the defaults and foreclosures are on the rise again in the United States. It was once thought that the worst was over (no one spoke of seizures) but it now appears that the revival was artificial.
Figures released Tuesday by the National Association of Realtors are alarming: the volume of resale homes fell 27% compared to June 2009. And according to statistics from the Treasury Department, the defaults on mortgages have reached 13.6% at the end of 2009.Real Estate Agent Redondo Beach, Alison Clay-Deboffe can only sympathize with the suffering of former clients who call today to share their hardships. "As the retiree who has been keen to buy a duplex without really afford, but which has been encouraged by his banker at the time when lenders were handing out loans without verifying." This lady, whose name Alison prefers silence , is now on the verge of being expelled. She does not know where to go. "She is guilty of wanting to live beyond its means. But the lender is even more irresponsible. "
In California, the number of dwellings for which a seizure is imminent now stands at 104,000. Over the past twelve months, about 76,000 seizures were conducted in the state. "And their numbers will grow as the reviewable-rate loans contracted five years ago expire," says Michael.The mortgages of millions of people are going to increase by several hundred dollars per month. They can not afford to repay. "All this when, far from reinforcing the job market weakens.