Your #1 Guide to Real Estate!
 Welcome to the BearLakeRealEstate.com Blog

2011-12-13 16:32:15
House Flippers may be major cause of Housing Downt

House Flippers to Blame for Housing Downturn?

I have just copied and pasted this report from Realtor.com.  In the Bear Lake area we had a lot of 'flippers' working this recreation market and may have contributed the the downturn in Bear Lake as this report is implying.  More data may be needed to finalize or solidify this condition.

House flippers — made up of investors who bought up homes during the housing boom, possibly made a few upgrades to the home, and quickly resold the homes for high-dollar profit — played a larger role in causing the housing bubble than previously thought, according to a new federal report out by the Federal Reserve Bank of New York. The impact that speculative real estate investors played in driving the housing downturn has mostly been overlooked until now, the researchers note. 

The speculative investors used low downpayments and subprime credit in buying up multiple homes at once, the report says. Their actions attributed to home prices in some areas being inflated, researchers say. 

'This may have allowed the bubble to inflate further, which caused millions of owner-occupants to pay more if they wanted to buy a home for their family,' researchers note in the report.

House flippers made up a big piece of the real estate market during the housing boom.  According to the report, more than one-third of all home mortgages from 2006 were to people who already owned at least one home. What’s more, “in Arizona, California, Florida and Nevada, where average home prices more than doubled from 2000 to 2006, investors made up nearly half of all mortgage-backed purchases during the housing bubble,” the Associated Press reports. “Buyers owning three or more properties represented the fastest-growing segment of home owners during that time.”

When home values began to fall in 2006, investors defaulted on their loans in large numbers, accounting for more than 25 percent of seriously delinquent mortgage balances, according to the report. In investor hot-spots like Arizona, California, Florida, and Nevada, investors accounted for more than a third of seriously delinquent mortgage balances from 2007 to 2009.

The report urges lenders and regulators to take action to limit speculative borrowing in order to avoid a future housing downturn.  

 
Blog Archive
2013-03-11 16:50:44
Discounts of Foreclosures - Recreation Realty

2013-01-29 14:21:11
January 2013 Newsletter - Paul Webb - Recreation R

2013-01-17 11:11:39
Justify the Sale Price of Your Cabin - Recreation

2013-01-17 11:07:02
2013 Housing Predictions - Recreation Realty

2013-01-03 12:04:44
Shadow Inventory Threat Wanes - Bear Lake Real Est

2012-12-14 16:13:21
Credit s for Lenders - Recreation Realty

2012-11-12 12:31:06
Cautious Optimistism in Real Estate - Recreation R

2012-11-07 12:24:41
Obama victory will affect Real Estate at Bear Lake

2012-09-07 11:58:06
Obama will protect the mortgage interest deduction

2012-08-31 13:35:52
Buyers Worried They're Losing Bargaining Power

2012-08-13 14:16:36
4 Reasons To Buy Now

2012-07-18 14:30:58
Inventory numbers are good news

2012-06-14 15:04:18
Another round of increased forclosure and short sa

2012-04-26 17:32:19
Increased activity and sales at Bear Lake

2012-04-24 15:03:41
Are Low Ball offers a thing of the past?

2012-04-02 16:58:37
Is a Forclosure Wave Coming this Summer?

2012-04-02 16:58:37
Is a Forclosure Wave Coming this Summer?

2012-03-23 12:30:56
Home price bottoming?

2012-03-16 13:32:09
Myths about Foreclosed homes

2012-03-12 20:18:54
Forclosure inventory is reducing

2012-03-07 12:15:04
Housing affordability at Record High....Very good

2012-03-06 13:14:58
Short Sale Questions and Answers

2012-02-13 13:17:33
Lender participation in recovery

2012-02-07 10:33:16
More Deals Falling Through

2012-01-13 11:27:18
Record low Mortgage rates

Click here to see ALL articles.


Comment on this Article

Your Name:
Your Email:
Comments:
Verify:  Please enter the numbers shown to help eliminate spam.
Penilee 'Peni' Stevens
Broker / Realtor
435-757-3949
Kathleen Johnson
UT/ID Agent
435-213-0073
Heather Moldenhauer
UT/ID Agent
801-618-7990
Tonya Peterson
UT/ID Agent
435-757-8008
Mindy Nelson
UT Agent
435-760-9365
Joel Smith
ID Agent
208-851-0241
Charlotte
ID Agent
208-851-0241