Maryland foreclosure laws "kicked the can down the road" (Baltimore: section 8, short sales)

[InchingWest]

Read this article in today's print edition (I guess it came out earlier online) of the Baltimore Sun. My comments in red. Emphasis in bold. Not every paragraph from the article will be in this post.

Years after housing crisis, foreclosures remain high in Maryland - Baltimore Sun

While other metropolitan areas nationwide have recovered from the housing crisis, the Baltimore area is wading through a second wave of short sales and foreclosure sales that could continue to be a drag on the real estate market into 2017. Experts blame (blame because lower prices are supposed to be "bad") the high share of so-called "distressed sales" for keeping home sales prices down in the region. A couple of years ago, many observers thought the wave of distressed sales would abate within a few months. Instead, they continue and, in September, Maryland had the highest proportion of distressed sales to all home sales of any state, at 20.7 percent, according to CoreLogic, a California-based real estate industry analysis firm. The next-highest rate was 19.8 percent in Florida. (Wooo, worse even than Florida!)

CoreLogic reported separately that foreclosure filings remain high but have been trending downward. In Baltimore, one in 310 homes had a new foreclosure filing in October. For the metro area, it was one home out of every 429, according to CoreLogic. After the housing bubble burst, Maryland changed its foreclosure laws, giving homeowners more time to work on loan modifications or other measures. Previously, a foreclosure process might just take days. That well-intentioned intervention (good intentions often have negative consequences, just look at section 8 housing!) just "kicked the can down the road" and led to the second wave of foreclosures, said Sam Khater, deputy chief economist with CoreLogic.


Carol Anne Gilbert, assistant secretary for neighborhood revitalization at the Maryland Department of Housing and Community Development, disputed the notion that consumer protection laws passed by the General Assembly five years ago are contributing to the backlog of foreclosures still in the system. "We're a little puzzled (why is this government worker puzzled?) why some of these foreclosures haven't moved through the system," said Gilbert, speculating that some lenders might have held on to homes while waiting for the market to rebound (thus screwing over responsible 1st time buyers) so they could sell for a higher price. "I don't think it's appropriate to say that the consumer protections have caused the long delay in the foreclosure process."

(And not just in Baltimore too) In October, sales of foreclosed properties — not including short sales — made up 24 percent to 28 percent of all sales in Caroline, Worcester and St. Mary's counties, according to RealtyTrac. In Baltimore, sales of foreclosures were 19.2 percent of the total in October, up from 15.6 percent at the same time last year. "I think the difference now is that people coming to us are significantly behind on their payments — five to six years behind," (must be nice living rent free for 6 years, hope they saved) she said. The cases "are much more complicated and getting assistance is harder."

(The realtors at the end of the article are silly, to save space here's only one of them Craig Wolf, president of the Greater Baltimore Board of Realtors for 2016, said that despite the flat median sales price, Realtors consider the housing market to be bullish (when are these shysters ever *not* bullish?) this year by other measures, including the number of sales and indications that more first-time buyers are entering the market.

[bufflove]

Of course it "kicked the can down the road;" the was the entire point and intention. It allowed people the chance to refinance, regain employment, see the markets to rebound, etc. It also spread out the remaining foreclosures instead of seeing a major collapse and crater like a number of other states experienced.

[North Beach Person]

Originally Posted by bufflove

Of course it "kicked the can down the road;" the was the entire point and intention. It allowed people the chance to refinance, regain employment, see the markets to rebound, etc. It also spread out the remaining foreclosures instead of seeing a major collapse and crater like a number of other states experienced.

And it still cratered in some jurisdictions (Prince George's County).


When the foreclosure changes were made it was stated then that there would be a follow on foreclosure increase when the new time frames ran out, so the only people who should be surprised are those who didn't pay attention.


Although not mentioned, foreclosures are up even in the wealthier. lower unemployment areas such as Howard, Montgomery, Anne Arundel and Calvert Counties. It's just not Baltimore.