Usually when RE prices go nowhere/down for several years. RE is regional so 1 area may be ok while another is in a slump. Too many looking for "opportunity" right now, so it's not worth bothering with. Maybe 2-3 years from now.
Foreclosure rate is not a function of real estate pricing. Foreclosures correlate well with unemployment and layoffs. With the current boom in no-down ARM mortgages, foreclosure rates will also likely be correlated to increases in interest rate indices. For the first time we may see a surge in foreclosures among the fully employed.
I thought there was a post somewhere on this forum which talks about how much it will hurt if the house you buy drop 10 percent.
The market is completely local. Places like up state NY always have high foreclosure rates. They just donât have enough jobs and there is too much land available to choose from. Then look at areas like Manhattan or South Florida that have a growing job market and limited amount of land. The market slows down there but prices hold (it just takes longer to sell). It gets even more local then that. I am in Pompano Beach FL and housing prices are still going up. There is a ton of development here with new high end stores, restaurants, art galleries, and so on that is attracting people with money. BMW, Mercedes, and Porches are a dime a dozen. Half the houses on the water have million dollar yachts parked in the yard. But just a few miles away in Hollywood FL there are some good bargains and itâs mainly because the city does not have much to offer. Dunkin Donuts and Dennyâs donât attract money. So it is completely local! Interest rates have a huge effect on most of the market. But when the area has demand there is very little effect. Itâs just like the stock market. Even when the market falls there are always the few companies that have strong gains.
I forgot to add that the answer to you question is not really when will the foreclosure rates be the highest, but where. Right now I believe it is Georgia. Each town or city has different cycles. Just like market sectors