In today's video I'm going to talk about The latest numbers we have regarding Foreclosures um in the United States I Want to talk about the residential Market but first I want to talk about The commercial Market as well some very Big changes um regarding foreclosures on A national level this is from Adam or Attom just posted on April 17th it says Commercial foreclosures increased 6% From last month and Rose by 117% From last year the states of the most Commercial foreclosures in March 2024 Included California New York and Florida So one thing that is different regarding Commercial um valuations and Foreclosures compared to residential is That residential your home value is Dependent on other properties that are Close to you um what they sold for so You look at comparable sales for um Commercial State look at your vacancy Rate so if you purchased a property back In 2022 and your um occupancy was at 98% Meaning only 2% was vacant but fast Forward you know a year later and if Your U vacancy rate um increased to 50% In other words your building is half Empty that would mean approximately that Your valuation of your building just Decreased by 50% so your valuation on Commercial properties is dependent on How many tenants you have in there which
Is much different compared to the Residential real estate market so in any Case here's a chart that they um shared Looking at uh forclosure rates for Commercial buildings and see here back In this is lace data they have from them Is in March uh there was 625 commercial Buildings that were foreclosed on Besides January this is the highest rate We've had going back to approximately 2015 also the current numbers we have Right now are much higher compared to to May 2020 when of course we had Co Lockdowns but all these um initiatives That um caused foreclosures to be halted Altogether and actually touch on that Right here in May 2020 the US saw a Significant low in commercial Foreclosures hitting only 141 reflecting The immediate impacts of the pandemic And the Swift response uh measures like Foreclosure moratoriums and financial Aid by March of 2024 Commercial foreclosures had risen to 625 a 117% year-over-year increase compared to The uh 2020 low um in March 2024 California had the highest number Of foreclosure properties uh or of Commercial properties for the month at 187 that was an 8% decrease from last Month but a 45% increase from one year ago California began experiencing a no Noble
Rise in commercial foreclosures back in November uh 2023 meanwhile after California the next highest rate was Actually in New York at 61 commercial Foreclosures in March that was a 5% gain From last month and a big increase up by 65% from a year ago after that we had Florida up by 30% from last month up by 107% from last year then we have Texas Up by 31% from uh Fe February and a Giant increase of 129% year-over-year Then New Jersey also big gains up by 31% From last month and up by 133% from 12 months ago now stay tuned For the latest developments on that and Of course I'll definitely keep you Posted uh let's talk about the Residential uh foreclosure uh stats uh Right now though this is posted on April 11th again from Adam or attom it says a Total of 95341 us properties had a foreclosure Filing during the first quarter this Year up 3% from the previous quarter and Down less than 1% from one year ago uh This report also shows that there was Around 33,000 us properties with a Forclosure filing this is not a Completed foreclosure just a filing uh This month that's down by 1% from February and down 10% from one year ago So overall forclosure filing um this March decreased from February and also Decrease um by 10% from March of
2023 um their CEO stay the following While foreclosures remain relatively Stable we're closely monitoring these Trends homeowners continue to hold on to Significant Equity contributing to the Persistently hot housing market um as I Reported to you guys a few days ago Redin just announced that existing home Sold prices or I should say the medium Sold price reach a new all-time record High on top of that a lot of people have Equity in their houses as well unless You bought a house at the peak and you Paid way over the apprais value back in 2022 right any case cor logic uh Announced that um us homeowners with Mortgages so approximately 62% of houses Have a mortgage this means that Approximately what 38% do not have a Mortgage and they have um uh no loan on Their houses so in any case for these People who do have a loan on their house Uh their Equity just increased by $1.3 Trillion since the fourth quarter of 2022 a gain of 8.6% on a year your basis and this by The way covers Q4 of 2023 uh a giant increase of 8.6% Compared to Q4 of 2022 so not only do Americans have a lot Of equity in their houses in general but Also there's very few amount of people Who have negative equity in their houses In other words they owe more on their
House than than their home is worth uh That's approximately 1.8% of all Mortgage properties have negative equity Right now and has that has decreased by 15% compared to the fourth quarter of 2022 what's also helping um Americans as Well regarding foreclosures of course is Due to the increase in home prices but Also due to the fact that approximately 96% of people have loans on their houses Have a fixed rate mortgage here's a Really good uh chart I found on um resi Club analytics.com a fantastic website If you guys want to see um you know Analytics regarding the US housing Market it says Among Us mortgage Borrowers people have loans on their Houses 96% have long-term fixed rates With a majority being 30-year fixed rate Mortgages of course a lot of people have Or not a lot of people but some people Have 15year uh loans as well in contrast Look at these other countries Finland 95.4% for people have a loan in their Houses have a variable rate in in other Words it's fixed for up to one year can You imagine buying a house in which your Loan or your rate is only fixed for one Year year I mean uh look at what Happened over the past couple years Rates have been absolutely skyrocketing And um I couldn't even imagine being a Homeowner and have to go through I don't Know if they have to refinance every
Year or if their rate just as variable And adjust every year but in uh in the United States we are blessed to have um 30-year fixed rate mortgages in which Your principal interest payment will not Fluctuate at all as long as you don't Sell your house and of course if you as Long as you don't um refy your mortgage Which is much different compared to These other countries Australia 74.1% have a variable rate and only up To a one-year fix uh Ireland at 55.9% Sweden 48.3 50.5% in Sweden have a short-term Rate it's only fixed for 1 to five years Uh Canada I have a um some family member In Canada who is a real estate agent in Toronto Um I I was telling them last time we Visited that we have 30-year fixed rate Mortgages and they were just like one Person I was talking to Works in I Should say he works in the residential Um uh Housing Industry uh but I was Telling him we have 30-year fixed rate Mortgages he was just like Jaw Dro Because in Canada it's more normal to Have a fixed year uh Loan in the range Of three five 7 years maybe 10 years and The chart here shows that as well Because in in Canada 20 . 6% have a Variable rate only fixed for up to one Year um 32.5% have a rate that's fixed For only one to 5 years and
46.9% have a fixed term of 5 to 10 years So in Canada you have to refy your loan In other words you have to re-qualify For a loan once your loan um becomes Variable uh and so what happens if you Lose your job I don't know how that Works anyways we're we're blessed in in The United States here less than a 5% Share who have a loan that's less than Oneye fix um this is according to Lance Lambert by the way I spoke to him a Couple months ago great guy and by the Way I hope to have him on the channel Too as well so um stay tuned on that he Quoted the Dallas fed uh in their January report the unusually large Proportion of long-term fixed rate Mortgages in the US is partly a result Of government-backed secondary Market um Institutions such as Fanny May and Freddy Mack uh that help reduce cost for These mortgages securitization through These institutions allows us mortgages To be held and traded by investors Worldwide so what happens in the US if You buy a house you might get a letter You know very soon after saying hey your Loan just got you know transferred to a To Fanny May or Freddy Mack and so what They do there is they buy loans um and That uh that frees up more cash for your Lender so your lender has more funds to Lend out to more people to buy houses That's what we have in in Cal in not
California in in the United States Outside the US though variable rate and Short-term fixed rate mortgages are more Common because Banks which dominate Mortgage lending in these countries hold Loans on their balance sheets uh funded By deposits so in other words uh in These countries here uh if you go to a Bank they'll give you the money but They'll hold on to that loan whereas in Most um cases in uh in in America that Lender sells that loan to an investor Which frees up more cash to lend to Other uh home buyers the author Lance Lambert and also the founder of resi Analytics.com also points this out as Well which is a very good reminder here It's important to note that while many Homeowners monthly mortgage payments may Be shielded from spiked interest rates In other words the vast majority of us Do not have a very a rate uh for their Uh for mortgages but in unemployment or Unemployment situations may not be and Of course a lot of people have a lack of Savings in other words what he's saying Here is that the unemployment situation Is also tied directly to uh the Healthiness of our housing market as Well and overall we're not seeing a Giant Spike of unemployment but if we do A lot of Americans have a lock of Savings which I'll share with you guys In a little bit and that could um lead
To more distress home home sales um Later this year potentially all right Let's also talk about another report as Well this is from core logic just posted On April 25th this covers uh through uh February of 2024 so overall in February this year The overall mortgage delinquency rate is At 2.8% one year ago it was at 3% so it has Decreased by2 percentage points over the Past 12 months according to their Principal Economist for core logic she Stated the following the US dilcy rate Fell from a year earlier for the first Time in 6 months in February indicating That mortgage performance remains strong The decrease in delinquencies was driven By the the decrease in the share of Mortgages that were 6 months or more Past due a number that has been Consistently shrinking and fell to its Lowest levels in 15 years in February so A key early indication of future Foreclosures by the way is looking at uh People who are really late on their Paying on their mortgages so in California you can't start the Foreclosure process until you're at Least 90 days or more past due I would Imagine that varies by the state but Looking at people who are really late on Paying their um payments that would be a Really good indication regarding future
Forclosures as well but right now we're Not just seeing that just yet in regards To that she says as later stage Delinquencies decrease the share of Mortgages in for for closures remain at 3% in February where has been since March of 2022 and only slightly higher Than the all-time record low they also Um provided this as well some select States because again the overall uh rate Is at 2.8% however Louisiana is at 5.6% then we have Mississippi at 5.4 New York at 4 then we have Alabama West Virginia and Maryland by the way all These states decrease compared to uh February 2023 except for Louisiana that Increased by .1 percentage points cor Logic also provided this as well this is The top 10 states that have the high Share of serious delinquency rates this Means there're at least 90 days or more Past due so leading the nation is Actually Louisiana at a 2% rate then we Have New York Mississippi Hawaii DC Illinois Oklahoma Alabama Maryland and Pennsylvania coric also provided how Each of the um biggest metros fared as Well so there was only three Metro areas On a national level in which there Serious delinquency rate actually Increased in contrast there was 25 that Were the same and 356 metros in which The rate actually decreased compared to
One year ago now something I'm kind of Concerned about is this right here this Is according to our good uncle Fred and Of course the source is the uh fed uh This is the amount of consumer credit Card debt that's at 1 trillion or 1.3 Trillion right now and also a new All-time record high um as of February This year nearly $1.4 trillion of credit Card debt much higher compared to pre Pandemic levels so for example back in Let's just say February February of 2019 there was only one 1.06 trillion Now there's $ 1338 trillion and of course you know way Higher compared to uh the Great Recession when uh the levels was around $1 trillion on top of that the Delinquency rate is also um very high as Well so that rate is at 3.10% uh this is the Delancy rate on Credit cards by the way it's at 3.10% um for uh Q4 for 2023 which is much higher compared to um Pre pandemic era when the rate was Around 2.6% um looking at the past you know What is this early 1990s at 3.10% this the highest rates we've had Going back to Q4 of 2011 to make matters Worse the personal savings rate as of February of 2024 is only 3.6% Looking at preo levels it was around 6
To about 8 1 12% so the personal savings Rate at very low levels right now in Fact going back to January of 2008 um We're looking at preco levels uh the Personal savings rate at 3.6% is the lowest rate since August of 2008 and with that said please comment Below with your biggest takeaways from Today's video also if you guys got any Value out of this video whatsoever then Please like button appreciate that of Course appreciate you hope you guys have An awesome day and look forward to Seeing you on the next video [Music] [Music]
