As we navigate through 2023, real estate investors continue to keep an eye on the foreclosure market. With the end of the forbearance program, fluctuating mortgage delinquency rates, and a constantly evolving housing market, it’s essential to stay informed about the latest trends. This article provides an update on the foreclosure market and what real estate investors can expect in the coming months.
End of the Forbearance Program
The government-initiated forbearance program, which allowed homeowners to skip mortgage payments without going officially delinquent or running the risk of foreclosure, is coming to an end. This program was implemented in response to the COVID-19 pandemic and provided temporary relief for many homeowners. As the program concludes, it’s crucial for investors to understand its potential impact on the foreclosure market.
Mortgage Delinquency Rates
While some may be concerned about an influx of foreclosures due to the end of the forbearance program, it’s important to note that the overall mortgage delinquency rates have been stabilizing. Homeowners today are in a much more secure position compared to the 2008 financial crisis, with many borrowers having positive equity in their homes. Consequently, the likelihood of a housing market crash remains low.
According to property data provider ATTOM, foreclosure filings in April were down 10% from March but up 8% from the previous year. Foreclosure completions were down 39% from the previous month but increased 3% from a year ago. ATTOM’s CEO, Rob Barber, stated that foreclosure activity continues to stabilize and even correct itself in 2023. The overall trend indicates that the foreclosure market is slowly returning to a more balanced state, providing real estate investors with potential opportunities.
Housing Market Outlook for 2023
The U.S. housing market in 2023 is shaped by several key trends and factors, including mortgage rates and volume, existing home sales, inventory levels, new home sales, pricing trends, delinquencies, and defaults. Mortgage rates are expected to remain low, which could further fuel the demand for homes and drive up prices.
However, the increase in foreclosure activity and the end of the forbearance program could potentially lead to a higher number of distressed properties entering the market. This could present real estate investors with new opportunities for acquiring properties at lower prices.
While the foreclosure market continues to evolve in 2023, real estate investors should remain vigilant and well-informed to capitalize on potential opportunities. By staying updated on market trends and keeping a close eye on foreclosure activity, investors can position themselves for success in the coming months.
Special thanks to Rick Sharga for contributing to this report. Make sure you follow him on Twitter.