More Foreclosures Drag On Home Prices

Apr 26, 2012 7:03am

Morning Business Memo

Home prices have been bogged down by a series of problems, from restrictive lending policies by banks to the weak housing market. But foreclosures are the biggest drag in many parts of the country. The real estate marketing firm RealtyTrac says number of homes in foreclosure rose during the first three months of this year in more than half of the largest metropolitan areas.

“First-quarter metro foreclosure trends were a mixed bag,” said Brandon Moore, chief executive officer of RealtyTrac. “While the majority of metro areas continued to show foreclosure activity down from a year ago, more than half reported increasing foreclosure activity from the previous quarter – an early sign that long-dormant foreclosures are coming out of hibernation in many local markets.”

Home ownership is down. According to a new Gallup poll, 62% of Americans say they own a home, compared to 68 percent last year.  Some 53 percent of Americans believe their house is worth more today than when they bought it, down significantly from 80 percent in 2008 and 92 percent in 2006.

The US economy may be doing a little better. The Federal Reserve nudged its forecasts for growth and employment slightly higher. But the Fed says it will keep interest rates very low, and still stands ready to plunge in and buy more government bonds if needed.

Shares in Accretive Health, a Chicago-based company that specializes in medical debt collection, plunged more than 40 percent after a report was released criticizing its practices. Minnesota’s Attorney General accused the company of routinely pressuring hospital patients to pay up.

Today is a busy day for earnings reports. That includes results due from energy giant Exxon Mobil, Chrysler, Starbucks and Amazon.com.

Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc

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