Mortgage Crisis Hit The Sales Value Of Real Estate

Mortgage Crisis Hit The Sales Value Of Real Estate

Mortgage Crisis Hit the​ Sales & Value of​ Real Estate
In a​ conference of​ US Mayors,​ experts said that in​ last 16 years this is​ the​ worst housing downturn .​
They have estimated that during the​ next year this will lead to​ the​ decline of​ property value by $1.2 trillion and will cut down tax revenue by more than $6.6 billion .​
It was said that the​ California would suffer the​ hardest,​ as​ decrease in​ property value here will be around $630.6 billion .​
They also said that the​ New York City might face the​ utmost slowdown in​ the​ economic output because of​ the​ mortgage crisis.
The real estate market in​ United States,​ especially the​ residential subdivision is​ very uncertain as​ the​ prices are pushed down due to​ the​ increasing percentage of​ the​ foreclosures among the​ sub prime borrowers .​
The highest default rate is​ from the​ sub prime section .​
This has led to​ the​ record number of​ unsold homes .​
In a​ recently released report on​ home sales by National Association of​ Realtors,​ it​ is​ very clear that the​ things are getting worse everyday .​
The report reveals the​ data of​ existing home sales in​ the​ month of​ October and it​ is​ actually a​ shocking one that shows the​ largest fall of​ existing home sales in​ last 8 years .​
They said that during the​ last quarter home prices fell in​ one-third cities of​ the​ United States due to​ the​ strict lending process .​
This also caused decline in​ the​ nationwide home sales by 14 percent.
The October existing home sales including different types of​ houses were down 1.2 percent at​ a​ seasonally adjusted annual rate of​ 4.97 million units compared to​ the​ 5.03 million units of​ September 2018 .​
The figures in​ October are 20.7 percent lower than the​ 6.27 million units that were sold in​ September 2018.
The seasonally adjusted annual rate of​ sales of​ new homes in​ October was at​ 728,​000 units .​
This month there is​ a​ little increase of​ 1.7 percent above the​ revised September sales figure of​ 716,​000 units .​
If we compare with the​ new homes’ sales figure of​ October 2018,​ then this is​ the​ sale is​ 23.6 percent lower than the​ 952,​000 units of​ October 2018.
Experts believe that the​ 1.7 percent increase can barely be called as​ recovery; yet,​ there were few good signs in​ the​ report in​ the​ report .​
To start with,​ sales in​ all the​ regions except the​ West were positive enough compared to​ September with the​ longtime sufferer Midwest up by 14.3 percent month-over-month .​
Three of​ the​ four regions were still self-indulgent well below October 2018 figures but the​ Northeast,​ which had begu​n its downturn before the​ other provinces,​ was up by 43.6 percent when compared to​ the​ October 2018 sales.
Inventory was another positive sign in​ the​ report .​
During September there was a​ 9.0 month supply of​ new homes for sale nationally,​ a​ figure that had dropped to​ 8.5 months in​ October.
Experts believe that the​ fall in​ the​ value of​ the​ bonds backed by mortgages is​ the​ main culprit that has forced the​ US banks and financial institutions to​ take write downs more than $45 million and also tighten their lending standards .​
Falling home prices also created trouble in​ refinancing or​ selling the​ homes.

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