Experts say the price drops are great for buyers but bad for sellers, adding though that the situation is likely temporary, due to backlogs in old foreclosures and not the creation of new ones.
According to the Calhoun County Probate Office, there were 102 total foreclosures in the county in April, May and June. In January, February and March there were just 79 foreclosures. There were also more foreclosures during the second quarter than the 79 that were reported in the same period last year.
This year’s second quarter had the highest number of foreclosures since the second quarter of 2010, when 117 were reported.
The rise in foreclosures led to a drop in the average sales price of county homes in May. According to the Alabama Center for Real Estate, the average sales price for homes in the county decreased to $101,345 in May from a $102,924 average price in April.
“It’s not great for the area in general, but it’s great for buyers right now,” Joey Crews of Keller Williams Realty in Anniston said of the price drop. “The lower prices really attract people, even if the home is not in as good condition.”
Everett King of ERA King Real Estate in Anniston noted that though foreclosures lowered prices, they do not indicate the housing market is weakening necessarily. He said many of the foreclosures are not new, but are ones that banks backlogged and are just now bringing to sale.
“In the long run, we need them to be released into the system,” King said.
King said the market would never return to a more traditional, normal state until the majority of foreclosed homes in the area are sold. Banks foreclosed on many homes around the county when the housing market collapsed in 2007. Skyrocketing unemployment then led to further foreclosures. The housing market has been slowly recovering ever since.
Anthony Humphries, president of Noble Bank and Trust, said his bank has not had any new foreclosures in months.
“We had one family residence … we probably had it for about nine months or so,” Humphries said. “But we decided to take the deed in lieu of foreclosure anyway.”
Humphries said his bank does not deal with as many mortgages and foreclosures in general as some other banks. However, he added that his bank works diligently to keep from foreclosing on any homes.
“We don’t want your house,” Humphries said. “We’ll extend the payments (and) do whatever we can to help people stay in their homes.”
Humphries noted that lower interest rates brought on by the weak market have increased refinancing of mortgages at his bank. Interest rates now are around 3 percent.
“We’re getting more refinances … and we’re getting more home construction lending and financing, but not a lot,” he said.
King said that though there was an increase in foreclosures in the second quarter, there should not be many more to come.
“There are a finite number of foreclosures left,” King said. “And the sooner we get through them, the better off we’ll be.”
Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star