At its peak in 2010, more than 14% of all mortgages were in some form of delinquency or foreclosure. Many feared these distressed properties would be sold at steep discounts by desperate lenders and subsequently depress the housing market for the next several years.
However, with delinquent mortgages hovering around their lowest levels in 5 years, it looks like fewer homes will be entering foreclosure than originally predicted, allowing inventory and prices to stabilize.
And while the national foreclosure rate is still holding steady, only 12 states are above the national average, reinforcing the fact that foreclosures are more of a regional issue than a national concern. In fact, only 5 states are materially higher than the national average – Florida, New Jersey, Illinois, New York, and Nevada.
This is important because multifamily investments benefit from a strong housing market. (1) It keeps rental supply in check as more houses remain as single family residences and (2) it helps create more jobs which in turn helps the economy.