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Buying an REO? Pay Attention to Foreclosures Per Capita

Foreclsoures Per Capita February 2010

Foreclosure filings topped 300,000 for the 12th straight month last month as 1 in every 418 U.S. homes received a foreclosure filing, Nevada being the worst and Vermont the best.

It’s a small improvement from January and just a 6 percent increase over February 2009.

On a per-capita basis, foreclosure density varies by state, and here are the top 4:

  • Nevada : 1 foreclosure filing per 102 homes
  • Florida : 1 foreclosure filing per 163 homes
  • Arizona : 1 foreclosure filing per 163 homes
  • California : 1 foreclosure filing per 195 homes

Also, as in January 2010, foreclosures across the country were concentrated. 10 states beat the national Foreclosure Per Capita average and 40 states fell below.

Like everything else is real estate, it seems, foreclosures are local and that is what you should pay attention to.

While statistics are important, what’s going on in Idaho doesn’t matter if you live in Houston, so try not to pay too much attention to all those over-exaggerated and worry-some reports on TV. Stay local and get with a good Realtor that keeps up with this stuff.

For today’s Texas home buyers, foreclosures represent an interesting opportunity.

Homes bought in various stages of foreclosure are often less expensive than other, non-foreclosure homes. It’s one reason why distressed home sales account for 38 percent of all resales. However, less expensive doesn’t always mean less costly.  A foreclosed home may be in various stages of disrepair and they’re often sold as-is, as policy.

Buying new or used can be cheaper than buying broken-down.

Therefore, if you’re in the market for a bank-owned home, make sure you know what you’re buying before you sign a contract. Have qualified professionals review and inspect the property, as needed. Damage to plumbing, electric, or the property’s structure, for example, may not be so obvious on a walk-though and you’ll want to know about it before you buy as these repairs can definitely add up quick!

Also, a question that I get asked is if foreclosed homes are eligible for the federal tax credit and the answer is YES. All rules apply as if it were a new home so, as long as you are under contract by April 30, 2010 and closed by June 30, 2010, and qualify with the rest of the guidelines, you will get your money!