In this 21 minute video, Lydia Wietsma and I discuss the latest in forbearance, foreclosures, loan servicing, Zillow, and the market.
80% of the forbearance exits have stayed in their homes. With over 3 million borrowers having stayed in their homes after exiting their plan, the forbearance program has been very successful. There are 1.1 million borrowers still in forbearance, if 80% of those stay in their homes which is 880,000 homeowners, then we may see as many as 220,000 new properties come to market, nationwide. That breaks down to 4400 per state. And that would be overtime. There is no flood of listings that will come as borrowers exit forbearance.
Foreclosure filings are up. There are always foreclosures. Even during normal times there are foreclosures. On average, there are about 40,000 per month nationwide. There is a backlog of foreclosures due to the moratorium so expect increases but when you look at the chart shown, even with the current increase in pre-foreclosures, we are still way below 2019 numbers. In 2019 we never talked about foreclosures having an impact on the market.
On Monday, Zillow announced that its iBuyer will pause all purchases through the end of the year. While yes, this does impact our market, the move does not define our market, nor will it cause sweeping changes. Given that the iBuyer market share is around 8% we will likely see a drop in demand. Zillow was the last iBuyer to rein in its purchases as the market shifts.
Loan servicers are shifting back towards BPOs from iBuyer inspections. Sellers cannot expect the market of March and April. Buyers are educated and they see more and more homes coming to market and staying. Inventory is up and days on market have gone from 5 in April to 11 now. This is good for buyers. As the market slowly moves towards seasonality and balance, it will feel strange, and after being used to a market frenzy, a normal market will seem very slow. Everyone will benefit from a slow and steady market, whenever it arrives.
Sarah Perkins is an award winning account executive and has been in title sales since 2004. As the Director of Industry Research & Senior Account Executive, Sarah’s role is to bring real estate transactions to Navi Title. Sarah supports her clients by helping them navigate the ever-changing real estate space through thorough research and understanding of current trends impacting today’s home buyers and sellers.