Despite all the positive predictions for real estate this year, distressed property- short sales and foreclosures are now common factors in the market. Employment, home values, and consumer confidence will determine whether they go up or down. The one thing that’s certain is that they remain and affect housing conditions.

So the next natural question is, what will be the ultimate solution?  According to the National Association of Realtors, 3 predictions are on the forefront:

1. Government home owner assistance programs will become more attractive and effective-Most of the government’s initial efforts at helping home owners who were threatened with foreclosure due to problems like job loss or medical expenses were little or no help at all. This was primarily due to a combination of poor promotion of the programs and arcane, overly bureaucratic processes. newer initiatives, such as the “Hardest Hit” mortgage assistance programs and the revamped Home Affordable Refinance Program (HARP), will likely get more attention this year and beyond. The hope is they will be better publicized and administered. The goal is to have these programs find higher-level efficiencies in the long-term.

2. Banks will develop new standards for dealing with REOs and delinquent home owners-In 2012, the theme will likely be managing shadow inventory:REOs and delinquent home owners. Banks may work to carve out special deals, such as leasing foreclosed and bank-owned homes to their former owners. They may even allow foreclosed-on and delinquent borrowers to continue living in homes without making any payments — at least in the short-term —because they want properties maintained for eventual property sale.

3. The amount of evictions will stay the same or even go down-statistics show that while the number of evictions that have taken place over the past couple of years seems high compared with healthier economic times, they actually aren’t as high as they could be. Why?  One main reason is evictions are labor-intensive and involve some thorny legal procedures. Many banks simply don’t have the will or the resources right now to evict borrowers. A trending perk is that many neighbors may pitch in to combat upkeep issues and utilize services for help in property maintenance…More Info

Your feedback on this issue is valued.  What outcomes do you predict?

 

My office  is located at 640 Vernon Ave in downtown Glencoe, Illinois.  Feel free to stop by our top ranked North Shore real estate office with questions or concerns.

 

 

 

 

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