Housing Doom Housing Bubble Blog

According to yesterday’s Arizona Republic, foreclosures in the Valley are skyrocketing:

The number of Valley homeowners losing their homes to foreclosure has shot up 566 percent so far this year, a result of the housing market’s slowdown and rising interest rates on a variety of risky mortgages.

Through October, there were 7,139 foreclosures, according to the data research firm Information Market. That compares with 1,072 foreclosures for the same period last year.

Last month alone, 1,396 Valley homes fell into foreclosure, compared with 934 in September.

Additionally, in October, 3,438 homeowners fell behind on their mortgage payments, and lenders took the first step toward foreclosing by filing a notice for a trustee sale. During September, 2,830 of those pre-foreclosure notices were filed in Maricopa County.

"The foreclosure problem in Arizona is only going to get worse," said Fred Karnas, the new director of the Arizona Department of Housing.

The situation is getting bad enough that the media is even willing to talk to a bear like me:

Read the rest of this entry »

We’ve heard time and again how prices would always go up in Las Vegas because of the short supply of land.  Even though supply is glutted and demand has disappeared, apparently the BLM wants to sell land badly enough to sell below appraised value:  [Hat tip Judge!]

The Bureau of Land Management is considering whether to abandon its policy of refusing to sell land for less than its appraised value.

Only one of 31 BLM parcels sold at the lackluster auction Nov. 1, which was the worst this decade by BLM standards.

The auction placed 167.5 acres up for grabs in Henderson, the southwest and other areas.

Only the sale of one 15-acre site at Pollack Drive and Welpman Avenue kept the auction from being a shutout.

Will a lack of interest cause the BLM to reconsider sales?  Apparently not:

It is possible that at the BLM’s next auction, tentatively scheduled for April, it may for the first time, allow bidding to start below the appraised value.

Bidders would be required to meet the reserve price, which is the appraised value, Palma said, but the more open bidding process would give insights as to the level of interest in the federally owned land and its current market value.

That could ultimately lead to changes that would allow property to be sold for less than appraised value, he said.

It seems odd that the BLM was so anxious to sell land, when they claim they don’t need to and demand is so low:

Craig Cherney, director of Western operations of the Philadelphia-based American Land Fund, a private equity and land acquisition group, said it is not surprising that parcels didn’t sell at the auction in a market where prices continue to decline.

"There is no demand, and basically it is a supply and demand problem," Cherney said. "There is overhang in the private real estate market and until that is burned through, there is going to be little demand from public and private homebuilders."

Given the glut of land for sale at the moment, the BLM could consider another alternative- don’t dump any more on the market.  If there is no demand, why sell it?