Over 5,000 Foreclosure Properties to Enter Phoenix Market
June 23rd, 2009 by 
Joseph Smith
More than 5,000 foreclosure properties are expected to enter the Maricopa County market this month, according to studies of mortgages and foreclosures in the Phoenix area.
If the forecast comes true, it would be the county’s second time to post a monthly foreclosure record of more than 5,000. In February this year, there were 5,240 foreclosure properties in the county.
As of last week, over 45,000 foreclosure actions are in their first stages. In the past 3 years, a total of 73,000 foreclosure filings have been completed, adding 73,000 foreclosure homes to foreclosure listings.
Additionally, mortgage lenders have also filed 5,700 pre-foreclosure notices last week, an increase of 700 from the pending transactions last month.
Many foreclosure filings are taking more than three months to become actual foreclosures because homeowners are working out affordable repayment schemes with their lenders or negotiating short sales to avoid foreclosure.
In Maricopa, short sales have been rising, but short selling is still only around 5 percent of total home sales.
Puzzled by the large discrepancy between the number of foreclosure filings and foreclosure properties, property analysts are contending that banks are intentionally controlling the release of their foreclosed properties into the market to prevent further drastic declines in home prices.
Leading property analysts say the banks’ decision is the right approach because overloading the housing market with around 45,000 foreclosure properties all at once will push down home prices to unimaginably low levels and devastate the market.
Some analysts also say that some banks are postponing actual foreclosures on many of their properties to control the amount of their losses. Large amounts of losses would discourage investors reviewing the banks’ books.
On other hand, some housing analysts say that many lenders have participated in the Obama administration’s Making Home Affordable Program. Either the banks really want to reduce the number of their foreclosure properties or they just want to comply with federal requests, especially for banks that received bailout money from the government.
But according to several federal bank regulators, the Obama administration’s foreclosure prevention program appears to be making a dent on the foreclosure problem, as shown in the data presented by HUD Secretary Shaun Donovan in his meeting with real estate editors.
As the Phoenix area is still experiencing large numbers of residential foreclosures, it is also expecting large numbers of foreclosure properties in the commercial property sector as developers of office, apartment and retail buildings continue to be downed by the recession.
