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The foreclosure situation continues to make news, raise concerns and impact the stock market. In today’s Washington Post, the Business page headline is "Mortgage Foreclosures Reach All-Time High". The bad news referred to is the report by the Mortgage Banker's Association stating that "2.04% of outstanding mortgages were in foreclosure in the 4th quarter last year, an all-time high".

California and Florida account for 30% of the foreclosures. These areas are particularly hard hit. Nationally, 42% of the foreclosures were for subprime ARMs and 20% were prime ARMs. Is there any good news out there?

One glimmer of hope is that the impact appears to be localized, meaning some areas are worse off and other areas are doing better then average. In the Washington DC Metro area things are noticeably better. Foreclosures in Virginia at 1.01%, in DC 1.0% and in Maryland they are 1.22%, nearly half the national average. So basically 1 mortgage in 100 in is default.

So what is the prognosis for our area? Some unqualified buyers bought bad loans for houses they couldn't afford. Unfortunately, everyone suffers. Until lenders can clear the loans and relieve the market glut, prices will continue to fall as sellers compete with each other and the banks to sell houses.

The good news is the Washington Metro area is doing better then most and should rebound quicker then most. When? Nobody really knows. We are monitoring values closely.

Heres the link to the article: http://www.washingtonpost.com/wp-dyn/content/article/2008/03/06/AR2008030601447.html