“Mortgage Meltdown” — “Foreclosures Rates Skyrocketing” — “Subprime Nightmare!”
Like Chicken Little running around screaming “The sky is falling!” the current media attention on foreclosures is overwhelmingly pessimistic. The media suggests that foreclosures everywhere are hitting record highs.
So how bad is it really? What is the state of foreclosures in Washington today and how does that compare to national statistics? Is it better or worse than it was five years ago or even ten?
According to the Mortgage Bankers Association (MBA) which tracks data on 85 percent of all mortgages in the US (approx. 44 million) the current foreclosure rate for Washington State as of June 2007 is .49 percent, whereas nationally it is 1.40 percent. This means that Washington is currently doing 65 percent better than the national rate.
Washington State is currently in slightly better shape foreclosures-wise than it was ten years ago, while nationally the foreclosures rates are worse. Looking at the second quarter in 1997 Washington foreclosures were at .50 percent which was 54 percent better than the national rate of 1.08 percent in 1997.
For many Washington citizens, their perception is that we are in a mortgage meltdown and due to sub-prime loans and foreclosures the market is going to be flooded with deeply discounted properties. Many of our clients believe what they hear on the national news when financial experts tell them not to buy real estate for the next 12 months. And although there are a few markets in the country that have been hit hard with bad mortgage and depreciating prices, Washington is not one of them.
Let me repeat, Washington is not one of them. Less than 6 percent of the mortgages in Washington fall under that sub-prime category. Less than 1 percent of the mortgages in Washington are in foreclosure. In fact, the foreclosure rate in Washington is as low as 10 years ago. In fact, home values are appreciating in Washington. Washington has been identified as one of the strongest markets in the country!
We need to share these facts with our neighbors and the news media. We must correct the perceptions that the real estate market is bad before the perception becomes reality.
Florida and California are experiencing a downturn in the real estate market due to these circumstances, Washington is not.
Nobody knows Washington real estate like a Washington REALTOR®. We invite the public to get the facts from the professionals that know the market best.
You can get additional information from the Washington REALTOR® website at www.warealtor.org.