Housing Crisis Upside: Bargains for Everyone

Housing Deals Across the Country

This luxury estate at 74 Brams Point Rd. on Hilton Head Island in South Carolina has yet to be sold, even though its asking price has been dropped to less than $9 million -- a nearly 50 percent reduction from the home's appraised value./Courtesy James Wedgeworth

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"It really is almost a national situation where we can find you at least one good deal almost everywhere," said Rick Sharga, the vice president of marketing for the foreclosure listing service RealtyTrac.

The deals could get better still. Sharga said that a combination of factors -- including higher unemployment, more defaults on risky "Alt-A" and "Options ARM" mortgages and the expiration of foreclosure moratoria set by banks and state governments -- will mean that foreclosures will continue to rise. That increase will result in even more houses hitting the market.

This two-bedroom home in Rochester, N.Y., was valued at $31,000 but sold for $8,000 at auction./Courtesy www.Bid4Homes.com

In addition, Sharga said that banks last year had many foreclosed properties that they didn't try to sell -- what Sharga calls a "shadow inventory." The banks waited, he said, either because they simply had too many foreclosures to handle or because they wanted to delay taking the write-downs that come with selling a foreclosed property.

This year, he said, those properties might finally go up for sale -- and that will boost the housing inventory even higher. The ultimate result, Sharga said, is more declines in housing prices.

"This is economics 101," he said. "You still have more inventory than you have buyers."