Phoenix Area Defaults Edge Up Again after Dip

Foreclosures.com: Phoenix Area Defaults Edge Up Again after Dip

SACRAMENTO, Calif.–(BUSINESS WIRE)–April 25, 2005–California based foreclosure property investment advisory firm Foreclosures.com reported today that new Notices of Trustee Sales in Maricopa County increased slightly to 1020 filings in March, up from 925 in February. 200 homes were actually sold at Trustee Sale Auction in March.

Foreclosures.com president said that the number of homes sold vs the number of new filings was on the high side compared to other markets the company services.

“Usually,” said Ms. McGee, “in strong markets like Phoenix, about 90% of homeowners in trouble either refinance, sell their way out of foreclosure, or cure the default in some other way.” Ms. McGee went on to say that rising interest rates would close the foreclosure window to many seeking refinancing, and would soon cool the rate of price appreciation the Maricopa County housing market has seen in 2004 and early 2005.

“The interest rate jump we saw late last year was premature, but this one is real because inflation is back,” Ms. McGee said. She added that the era of cheap money was fading into history and that she expected mortgage rates to rise steadily, if slowly, throughout the year.

“Unlike California, where we expect price corrections in several markets,” Ms. McGee continued, “we think the Phoenix market will remain strong, but that a period of consolidation lies ahead.” She added that, with 25% or more of new homes being sold to out of state investors who never intend to occupy the properties, the market is slightly distorted on the upside.

“If the increased cost of money flattens the appreciation curve, these investors will sell and move on. We may see a corresponding increase in foreclosure activity.”

Foreclosures.com has been publishing foreclosure property lists and assisting investors since 1992. They serve markets in selected major California counties, the metro areas of Las Vegas, Chicago, New York, and the state of New Jersey.

“It’s just as important to us to help people avoid needless foreclosure with counseling as it is to help investors make profits,” said Ms. McGee. “We have investor clients who save ten times as many homes as they buy and resell.” She added that there are options available to defaulted borrowers they may not know about. “Either way, we prevent them from losing everything at auction.”