The numbers pretty much speak for themselves, with 243,353 receiving notices in April. This is a vast increase from April 2007, when "only" 147,708 homes received the same notice. This was also a 4% increase from March. The numbers are based on a report from RealtyTrac Inc.
Homeowners in California and Florida are among the hardest hit. The two states had 9 metropolitan areas that ranked in the top ten areas of the country in terms of foreclosures.
U.S. home prices in 20 major cities declined 12.7% in February 2008 on a year-over-year basis -- a record -- according to the Standard & Poor's Case-Shiller Home Price Index (pdf), released Tuesday.
Meanwhile, the 10-city composite set yet another new record, as well, with an annual decline of 13.6%.
Las Vegas and Miami continue to hold the dubious distinction of being the weakest markets in the nation over the past 12 months, reporting double-digit annual declines of 22.8% and 21.7%, respectively, followed by Phoenix with a 20.8% decline.
Widespread price declines
For February 2008, markets in the West declined the most, with San Francisco, Las Vegas, and Los Angeles being the worst performers, with depreciation rates of more than 4% each. Charlotte is the only market with a positive return over the last 12 months, rising a scant 1.5%.
Home foreclosures in the United States rocketed 57% in March 2008 compared to a year ago, as more homeowners relinquished their homes to lenders, according to data compiled by RealtyTrac.
More than 234,000 properties were in some stage of foreclosure - - roughly 1 in 538 U.S. households, RealtyTrac announced Tuesday.
Nevada, California, and Florida had the highest foreclosure rates, while Vermont, North Dakota, and South Dakota had the lowest.
Handing back the keys
Economist Glen Langan said Tuesday he's not surprised that RealtyTrac indicated that the large foreclosure increase showed that many homeowners were simply walking away from homes worth substantially less than the mortgage and deeding the home back to the lender.
"If you can't refinance -- and in many cases today with more-rigorous mortgage requirements, you can't -- a home sale probably doesn't make much sense," Langan said. "If it's a $20,000 gap, a mortgage of $400,000 and a house value of $380,000, you probably sell, or search harder to find a lender who will refinance the note."
"But if you hold a mortgage for $400,000 and the house is now worth $200,000 or $175,000 or even less, it makes makes very little sense to sell, so you simply hand the deed and keys back to the lender, and say 'It's yours,' " Langan said. "And that's what a lot of homeowners are doing now."
However, Langan underscore that 'handing back the keys' is not without it downside. Doing so will still lower a borrower's credit rating, although Langan admits "that's probably at the bottom of concerns for many homeowners about to give up their homes." Also, the rising foreclosures will add large amounts of inventory to an already oversupplied housing market, depressing home prices for a longer period of time.
U.K. consumer confidence fell to its lowest level in almost four years in March 2008, as the housing downturn continued to weigh on consumer sentiment, Bloomberg News reported Wednesday.
Britain's Nationwide Building Society's index of sentiment declined one point to 77, its lowest level since records started in May 2004. The result is based on a survey of 1,204 people conducted by Taylor Nelson Sofres from February 18 to March 20, 2008.
U.K. housing sector weighs
Economist Mark Chandler, based in London, told BloggingStocks Wednesday the fall in housing prices is beginning to weigh on U.K. consumer confidence. The average home price in the United Kingdom fell 2.5% in March 2008 to 191,566 pounds or $379,000, according to a survey by mortgage lender HBOS Plc., according to Bloomberg.
Former U.S. Federal Reserve Chairman Alan Greenspan predicted that the decline in U.S. home prices will probably end "well before" early next year, as the home inventory supply declines, Bloomberg News reported Tuesday.
Further, Greenspan sees most of the excess inventory eliminated in early 2009, with home prices stabilizing "well before that."
U.S. home inventories total a 9.5- to 10-month supply, at current sales rates, depending on the survey. A normal home sales market typically has a 3-4 month supply.
Revisionist critique
Generally recognized as one of the premiere central bankers in the modern era, Greenspan's legacy and policies have been subject to revisionist criticism, largely as a result of the U.S. housing recession. Critics charge that the Greenspan-led Fed lowered interest rates too much to stimulate the U.S. economy following the September 11, 2001 terrorist attack on the United States. The over-stimulation, critics argue, led to the recent housing bubble. Second, critics say the Fed did not prudently exercise its regulatory power, which led to a collapse in underwriting standards, and the record mortgage defaults that precipitated the credit crunch following the bursting of the housing bubble in 2007.
Economists surveyed by Bloomberg News had expected February 2008 existing home sales to decline 1.0%. The January 2008 existing homes sales statistic was revised higher to an increase of 0.3%.
Regionally, February 2008 existing home sales fell 9.8% in the West, 5.5% in the South, and 3.7% in the Midwest. Sales rose 3.2% in the Northeast.
Meanwhile, the aggregate U.S. existing-home price will probably decline by 1.4% to a median of $215,800 for all of 2008 before rising 3.7% to $223,800 next year, the NAR said.
The existing home sales statistic is considered a lead economic indicator because the metric tracks actual signings for the month reported, in this case, February 2008.
Economic Analysis: A sub-par February 2008 existing home sales statistic, but one not entirely inconsistent with the consensus estimate. Existing home sales remain generally weak, which is typical for an economy in recession and a housing market where potential buyers expect future price declines, and hence postpone home purchase decisions.
My Ph.D. adviser David E. RePass, professor emeritus at the University of Connecticut, used to frequently recite an axiom about the U.S. Congress that rings true, regardless of era, or circumstance.
"Congress does not react, unless not reacting will result in the wrath of the American voter."
Well, concerning housing, it looks like Congress sees the wrath of the American voter ahead because the legislative body is starting to react.
Two measures working their way through Congress may ease the housing crisis. The first, a bipartisan Senate measure, is a modest step to address the rise in home foreclosures, The New York Times reported Friday.
As economists and stock reviewers will vouch, analysis can vary depending one's prism, or perspective -- i.e. how one views the economic world.
Look at the 2008 U.S. economy one way, and you see the onset of a conventional recession. Five or so years of GDP growth, earnings growth, investment, resource / commodity / raw material utilization, and consumption have basically run their course, and a pause is due. It's a period of lower earnings, less investment, lower consumption, and we call these pauses recessions.
Look at the 2008 U.S. economy another way and you see a different picture. Five or so years of GDP growth, earnings growth, but also substantial asset price inflation - - primarily in residential real estate - - combined with only modest improvement in the U.S. trade deficit, federal budget deficit, national savings rate, and a substantial weakening of the U.S. dollar. Then, a period of slower growth ensues, a slowdown made all the more onerous by the appearance of a credit crunch that began when the real estate balloon began to deflate, if not burst.
U.S. new home sales fell to a seasonally adjusted, annualized pace of 590,000 in February 2008 -- a 13-year low, the U.S. Commerce Department announced Wednesday (click here for the pdf).
Economists surveyed by Bloomberg News had expected February 2008 new home sales to register a 575,000 annualized rate.
Sales have now declined for four consecutive months, and are down about 30% in the last 12 months.
Meanwhile, January 2008 sales were revised up slightly, to 601,000 from the earlier released 588,000.
The number of homes on the market declined 2.1% to 471,000, the lowest level since July 2005. Also, the median sales price fell 2.7% in February 2008 to $244,100.
The dollar's modest rally faded Tuesday afternoon as traders calculated that the U.S. Federal Reserve is likely to continue to cut key, short-term interest rates by another 50 basis points to jump-start the anemic U.S. economy.
In mid-day Tuesday trading, the dollar was substantially lower against the world's other major currencies. The dollar fell almost 2 cents to $1.5596 versus the euro, about one-half yen to 100.22 versus Japan's yen, and about 1.5 cents to $2.0003 versus the British pound. The dollar also fell about 1 cent to $1.0095 versus the Swiss franc.
Short-lived dollar rally
Some traders had argued that the dollar would be able to post its second straight weekly rise on renewed confidence that the U.S. economy would perform better than expected, with a shallow recession, said Andrew Resnick, independent currency trader. But those comments most likely will be categorized as 'famous last words' based on recent U.S. housing data, which suggests continued U.S. economic sluggishness up ahead, he said.
U.S. home prices in 20 major cities declined 2.4% in January (pdf) 2008 -- a record, according to the Case-Shiller Home Price Index released Tuesday.
Meanwhile, the 10-city composite set yet another new record with an annual decline of 11.4%. The 20-city composite recorded an annual decline of 10.7%.
Las Vegas and Miami were the weakest markets in January 2008, reporting double-digit annual declines of 19.3%, followed by Phoenix with an 18.3% decline.
Groucho Marx once remarked that whenever things start to look really dark, remain calm, don't panic, and above all, turn on a light.
Given the barrage of financial stresses battering the credit and equity markets these days, consumers, economists and investors alike could use some of Groucho's levity, and some light. In this case the light may appear in the form of the Federal Housing Administration.
What's old is suddenly new
The Federal Housing Administration, the once-viewed-as-antiquated, irrelevant Great Depression-era government agency, is suddenly emerging as the centerpiece of government efforts to bolster the U.S. housing market, reported The Wall Street Journal (subscription required.)
The FHA has become the cheapest, and in many cases, the only alternative for borrowers who can make only a small down payment, and the agency is rapidly gaining market share.
A record 0.83% of mortgages were entering the foreclosure process in the last three months of 2007, compared to 0.54% for the same period in 2006, the MBA announced.
In addition, the delinquency rate reached 5.82% in Q4 2007 -- the highest level since 1985 -- up from 4.95% in Q4 2006.
U.S. pending homes sales were flat in January 2008, the National Associations of Realtors announced Thursday, in a statement, with the association also forecasting a gradual housing sector recovery in the second half of 2008.
Economists surveyed by Bloomberg News had forecast that January 2008 pending sales would fall 1%.
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in January 2008, held at a stable level of 85.9, unchanged from December 2007, but was 19.6% below the January 2007 reading of 106.8, the NAR said.
Regional stats
By region, the January 2008 Pending Home Sales Index was as follows: Northeast, down 4.1%; South, down 6.1%; West, up 13.0%; and Midwest, up 0.6%.
Home prices in the United States fell 8.9% in 2007, the biggest decline in more than 20 years, the Standard & Poor's Case-Shiller Index announced Tuesday.
Further, prices fell an alarming 5.4% in Q4 2007, the survey indicated. Prices fell in 2007 in 17 of 20 cities surveyed, officials said.
Meanwhile, the 20-city index plunged 9.1% for 2007, and the 10-city index plummeted 9.8% for the year.
Somber data
Robert J. Shiller, Professor at Yale University and study co-author said:
We reached a somber year-end for the housing market in 2007. Home prices across the nation and in most metro areas are significantly lower than where they were a year ago. Wherever you look things look bleak, with 17 of the 20 metro areas reporting annual declines and the remaining three reporting flat or moderate growth rates. Looking closely at these negative returns, you will see that 14 of the metro areas are also reporting record lows and eight are in double digit decline. The monthly data paint a similar picture, with all metro areas now reporting at least four consecutive negative monthly returns.
April saw a 65% increase in foreclosures from the same month a year ago.
U.S. home prices in 20 major cities declined 12.7% in February 2008 on a year-over-year basis -- a record -- according to the 
Home foreclosures in the United States rocketed 57% in March 2008 compared to a year ago, as more homeowners relinquished their homes to lenders, according to 
Former U.S. Federal Reserve Chairman Alan Greenspan predicted that the decline in U.S. home prices will probably end "well before" early next year, as the home inventory supply declines, 
As economists and stock reviewers will vouch, analysis can vary depending one's prism, or perspective -- i.e. how one views the economic world. 
U.S. new home sales fell to a seasonally adjusted, annualized pace of 590,000 in February 2008 -- a 13-year low, the U.S. Commerce Department announced Wednesday (click 
The dollar's modest rally faded Tuesday afternoon as traders calculated that the U.S. Federal Reserve is likely to continue to cut key, short-term interest rates by another 50 basis points to jump-start the anemic U.S. economy. 
Groucho Marx once remarked that whenever things start to look really dark, remain calm, don't panic, and above all, turn on a light.
U.S. home 
Home prices in the United States 
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