Analysts have shared that the wave of foreclosures is about to crest as a result of the recently announced agreement between the banks and the justice department regarding bank mortgage processing. The picture is a bit murky in the Tri-Cities and South Elgin. I’ll attempt to provide some clarity.
First, let’s look at the current number of bank-owned homes locally. When combined, St. Charles, Geneva, Batavia and South Elgin have 176 homes where the lender has already foreclosed and now owns the property. Not all of these homes are currently for sale because they are at different stages in the foreclosure process. Please see the attached table for data specific to each area.
Second, let’s look at the number of homes where banks have filed “pre-foreclosure” notices. This is the first step in the foreclosure process and gives us a sense of what may happen in the future. Pre-foreclosure is constituted by borrowers who have been given notice that if they don’t make payments, they will be foreclosed upon. Consequently, the vast majority of these borrowers will NOT be foreclosed on but will become current or sell their home.
There are 469 homes in the pre-foreclosure stage in the four cities. St. Charles has the highest number but also the lowest percentage of homes in pre-foreclosure. South Elgin has the highest percentage of distressed property currently for sale at nearly 20 percent.
If we assume that 2/3 of the homeowners become current on their mortgage and no deluge of additional foreclosures are announced, then going forward it appears the percentage of distressed property for sale in St. Charles and Batavia could increase slightly, Geneva would remain flat and South Elgin would increase dramatically. However, if less than 2/3 of the homeowners currently in default become current all of the markets will see an increase in the percentage of distressed sales.
For a list of distressed properties currently for sale you can email me at firstname.lastname@example.org. Let me know if you want data for a specific city.
This representation is based in whole or in part on data supplied by Midwest Real Estate Data LLC for the period January 2008 through March 2012. Midwest Real Estate Data LLC does not guarantee nor is it in any was responsible for its accuracy. Data maintained by Midwest Real Estate Data LLC may not reflect all real estate activity in the market.