Archive for the 'North Carolina Articles' Category

The number of foreclosed properties and REOs is expected to increase further in 2011 across the U.S. Raleigh, North Carolina, will not be spared, analysts have predicted, but this has not stopped them from declaring the metro area as the healthiest housing market in the whole country.

Foreclosure properties in Raleigh home auctions are projected to increase, but the metro region of Raleigh-Cary still remained the healthiest housing market in the whole country, according to a ranking from Builder Magazine. The region has been chosen as the top residential property market among the 100 biggest home markets in the U.S. Another North Carolina metropolitan region, Durham-Chapel Hill, was ranked third; with Austin, Texas, taking the second spot.

According to housing market analysts, the ranking of Raleigh might be questioned by some, given that foreclosure auctions in North Carolina are also expected to rise, with most analysts estimating home prices to drop by 10% in the area in 2011. In addition, the region currently has an inventory of unsold homes equivalent to a supply of 10 months. However, the ranking was based not just on foreclosure numbers and housing prices, but also on several other factors like job market growth, income, building permits and unemployment levels.

Local analysts explained that the ranking was justified since Raleigh had been more resilient than other U.S. housing markets during the time when foreclosures and REOs are at their highest. Moreover, the metropolitan area has a better growth outlook than majority of U.S. regions, analysts further added. They also stated that the strength of Raleigh's housing market was mainly due to the fact that it did not experience the same rapid price increases seen in other home markets during the real estate boom.

This means that when the housing market crisis hits and the number of auctions of foreclosed homes started rising, the area also did not suffer from massive declines in home prices. Analysts also claimed that the fact that home building permits are up in the region shows that the market is recovering faster than other areas. Permits for single family construction jumped by 16% in Raleigh-Cary last year compared with the previous period.

Although a projected increase in foreclosures and REOs is also expected to put a drag on Raleigh's housing market recovery, analysts reveal that the bigger worry is the unemployment level. They said that the unemployment rate, which currently stands at over 8%, should decline in the coming months to ensure the recovery of the housing industry.

The months covering the U.S. federal government's foreclosure tax credit program have come and go, but some areas of North Carolina seemed to have remained unaffected by the initiative as demand and prices of residential properties remained below desired levels. In Asheville, the tax initiative reportedly did not do much in terms of increasing home buying activities.

Before the deadline for the tax initiative came, several areas of the state were able to benefit, with properties offered in home auctions in Charlotte and in other metro areas being purchased in higher numbers while the program was in place. However, some areas like Asheville were unable to gain much from the program in terms of home buyer interests.

According to state housing data, lack of demand for properties offered at North Carolina foreclosure auctions resulted in a dip in home prices in several areas, including Asheville. The value of residential properties in the metro declined by 5.26% for the period covering 12 months ending September 30, 2010 when compared with year-ago levels.

Although the federal government's foreclosure tax credit did encourage some buyers to make home purchases, the impact was not enough to get Asheville out of the bottom half of the U.S. rankings for metro areas in terms of home prices for the 12 months covered by the ranking. According to the Federal Housing Finance Agency, out of 299 metro areas considered, Asheville came in at 254th in terms of home prices.

The poor performance of the metro region in terms of home values has been attributed by real estate analysts to the few people willing to purchase properties and the high number of homes under listings of foreclosure auctions. Simply put, the metro is suffering from a market imbalance where supplies are aplenty, but demand is very low. Analysts also stated that the Asheville home selling market is still far from a recovery, but it has certainly reached the point where it will not get any worse.

They stated that without the foreclosure tax credit program, something major needs to happen in the metro area to get buyers to purchase the numerous supplies of foreclosed properties offered by the region. They reported that only 10.5% of houses in Asheville that are on offer have sales contracts.

A retail establishment might soon be part of Charlotte foreclosure auctions as owners of the EpiCentre commercial property have filed for a Chapter 11 protection. A bankruptcy judge has approved the filing for the retail and entertainment center.

According to real estate market observers, the issue regarding EpiCentre shows that it is not only foreclosure home auctions in North Carolina that are contributing to the housing market problems of the area. Commercial properties are also getting hit by the real estate crisis, as evident in the recent bankruptcy filing made by the center's developers, Pacific Avenue LLC and Pacific Avenue II LLC.

With a big number of foreclosed dwellings ending up being sold in auctions of foreclosure houses in the state, the trouble facing the Charlotte commercial property did not come as a surprise for most market observers. A foreclosure proceeding has been launched by Regions Bank following the alleged failure of the commercial property's owners to pay the necessary obligation upon the note's maturity.

According to Regions Bank, the Pacific Avenue firms borrowed a total of $90 million on the commercial property, which is now facing the possibility of ending in Charlotte foreclosure auctions. The bank further revealed that the loan's maturity date was May 5 but the owners have not made any payment since December of last year.

Meanwhile, the owners of EpiCentre are suing Regions Bank over issues related to the loan agreement. Pacific Avenue's manager, The Ghazi Co., has stated that the bankruptcy protection was filed to prevent Regions Bank from conducting a "wrongful foreclosure" on the EpiCentre complex and to allow the limited companies to conduct debt reorganization.

The judge who approved the bankruptcy filing also approved several motions related to the case, including allowing the companies to use their bank accounts to pay for the unpaid salaries and benefits of Scott Cook, chief financial officer for the property, and several other employees tasked with overseeing and managing the property. In addition, EpiCentre will also be allowed to continue paying utility bills. An emergency motion which will allow cash collateral to be used has also been approved, albeit on an interim basis.

Whether EpiCentre will end up as one of the properties offered under Charlotte foreclosure auctions will not be known until weeks from now as both parties involved try to present their arguments to the courts.