On top of recent news that housing activity is at it’s lowest since WWII comes the latest news about foreclosures all around the USA. This is what those of us watching the mortgage reset schedule have been anticipating, and it could spell unequaled opportunity for the property management business.
The number of U.S. homes lost to foreclosure surged in July, another sign lenders are moving quicker to take back properties from homeowners behind in payments.
Lenders repossessed 92,858 properties last month, up 9 percent from June and an increase of 6 percent from July 2009. This was reported by the firm which follows the list of foreclosures, RealtyTrac Inc. on August 11th.
Banks have stepped up repossessions this year to clear out the backlog of bad loans. July makes the eighth month in a row that the pace of homes lost to foreclosure has increased on an annual basis.
Homeowners who are falling behind on their payments are being allowed to stay in their homes longer because lenders are reluctant to add to the backlog of foreclosed homes on the market. The number of properties receiving an initial default notice – the first step in the foreclosure process – rose 1 percent last month from June, but tumbled 28 percent versus July last year, the same.
The latest data reflect a foreclosure crisis that continues to drag on as many homeowners struggle to make their monthly payments amid high unemployment, slow job growth and an uneven rebound in home prices.
Economic problems, such as unemployment or reduced income, are now the main catalysts for foreclosures. Sadly, it is now homeowners with good credit who took out conventional, fixed-rate loans who are now the fastest growing group of foreclosures.
The obvious result is that there will be tens of thousands of families and individuals who will soon be needing rental housing. So the vacancy rates ought to be going down in the near future, especially for those who’ve made their properties attractive to residents.
If you’re finding the property management business more challenging and stressful in today’s economic environment, take heart. There are a number of ways to “set yourself free” from some of the burdensome aspects of your work.
- Begin by thinking “outside the box”.
Employ the latest technologies to make your record keeping, advertising and communications less complicated.
- “Streamline” your maintenance schedules and responses and routine tasks.
Property Management Software programs and specific “cloud-computing” applications are designed to save you time and reduce paperwork. Accepting payments online can also save you a significant amount of time and resources.
- Consider a new and improved business plan for your property management business.
The time to expand and grow your business can coincide with the new “tsunami wave” of prospective residents looking for rental housing. Plus there’s the growing number of investors who want to take advantage of these record number of foreclosures by becoming property owners.
- Become a local “go-to” person for information on how potential property owners can find good financing.
Distinguish yourself as someone investors need to know. Network, network network! Some of these property owners will be first-time owners and they will need managers like you. Spread the word that you are available to help them and make it easy for them to find you.
Where are the highest foreclosure rates?
According to an AP article, Nevada posted the highest foreclosure rate in July, with one in every 82 households receiving a foreclosure notice. The number of properties in Nevada receiving a foreclosure warning last month rose nearly 7 percent from June, but fell nearly 30 percent from the same month last year.
Rounding out the top 10 states with the highest foreclosure rate last month were: Arizona, Florida, California, Idaho, Michigan, Utah, Illinois, Georgia and Maryland.
For the creative and innovative property managers among us, find the “silver lining” and seize the chance to modify and improve our businesses.