I was shocked to see this headline from an Associated Press story yesterday, “Economists project home sales, construction to rise sharply in 2011 from extreme lows of 2010.” I was dumbfounded by the title of the article and even more taken back when I read the story which said, “The forecast delivered at the International Builders’ Show in Orlando sees U.S. economic growth sharply lifting home sales and residential construction over the next two years, but from near-historic lows posted last year. “ The chief economist for the National Association of Home Builders, David Crowe, said, “Single-family home construction, a bellwether for the housing market and the economy, will rise 21 percent to 575,000 this year and climb to 860,000 in 2012.” (Click here to read the full AP story.)
That is still about 75% less new construction from the peak of the housing boom a few years ago. This forecast was made just prior to yesterday’s release of the “Year-End 2010 U.S. Foreclosure Market Report” from RealtyTrac.com. Its headline read “Record 2.9 Million U.S. Properties Receive Foreclosure Filings in 2010 Despite 30-Month Low in December.” The report went on to say, “Total properties receiving foreclosure filings would have easily exceeded 3 million in 2010 had it not been for the fourth quarter drop in foreclosure activity — triggered primarily by the continuing controversy surrounding foreclosure documentation and procedures that prompted many major lenders to temporarily halt some foreclosure proceedings,” said James J. Saccacio, chief executive officer of RealtyTrac. “Even so, 2010 foreclosure activity still hit a record high for our report, and many of the foreclosure proceedings that were stopped in late 2010 — which we estimate may be as high as a quarter million — will likely be re-started and add to the numbers in early 2011.” (Click here to read the entire RealtyTrac report.)
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