Report: Foreclosure sales take longer on LI
At today's rate of home sales, it would take Long Island 21/2 years to sell off its current foreclosures and other "distressed" homes, the second longest amount of time among all metropolitan areas, a real estate data company said yesterday.
The 30.4-month supply of homes beat out Las Vegas, Detroit and other high-foreclosure areas, said CoreLogic, a California-based data provider that gets information from lenders and loan servicers. The Miami metropolitan area came in first.
This is CoreLogic's debut report on distressed properties. The category covers not just bank-owned foreclosures on sale but "shadow inventory" - everything from homes winding through the courts to any delinquent borrowers.
The main force behind Long Island's figure is sluggish sales, and another factor is the state's slow court process for foreclosures, said Sam Khater, Core-Logic's senior economist.
"The months' supply is high because the sales rate is low," Khater said. "Once sales pick up . . . that supply should get whittled down fairly quickly."
The federal home buyers' tax credit led to more deals in high-cost markets such as Long Island, he said, and when it fully expired in September, that led to sharper-than-average drops in sales.
Closings last month sank 32 percent from a year ago, said the Multiple Listing Service of Long Island.
The foreclosure process in courts here can exceed two years. This clogs up New York's "default pipeline," while in many other states, lenders can quickly foreclose and list homes for sale.
Bellport nurse Darlene Salamone has been in court fighting foreclosure for about a year and has been trying to get a loan modification for 18 months. Frustrated, she got an appointment to meet with the judge next week.
"I'm not just a piece of paper," said Salamone, who lost a side business. "I really at this point want to get answers."
There's one flaw in counting all foreclosure cases and defaulted loans as part of distressed inventory, Khater acknowledged.
It assumes that every delinquent borrower will end up foreclosed, he said, while there is no way to reliably estimate how many will on the metropolitan-area level.
Nationwide as of August, there were about 4.2 million homes for sale, unchanged from a year ago, and an additional 2.1 million in the shadow inventory, up from 1.9 million a year ago, CoreLogic said.
Hauppauge attorney Barry Lites, who represents borrowers in foreclosures, said he's a little surprised at Long Island's second place but "not terribly so."
"It speaks to the dearth of financing here."