PRESS RELEASE
U.S. Housing Headed for New Collapse;
Foreclosures Everywhere
May 5, 2010 (EIRNS)—The foreclosure tsunami in the United States, incredibly, is still rising in its fifth year, having increased another 7% in the first quarter, reaching 16% higher than the first quarter of last year, and headed for an unprecedented 4 million foreclosures in 2010, according to RealtyTrac. And the U.S. home market — home prices and the bank assets based on them — are now going into a second-wave collapse, joining the ongoing collapse of commercial real estate in a bank-destroying wave.
If LaRouche's Homeowners and Bank Protection Act (HBPA) had been passed back in 2007, when he first proposed it, we would be telling a different tale.
Scorning Obama's pathetic "foreclosure prevention" program for more than a year now, home losses were still spiking by another 19% even from February to March. And banks repossessed 35% more homes in the first quarter than they had in the terrible year 2009, reaching the highest level ever of repos in a quarter—56,000.
Now the White House's speculation-driving "homebuyers' tax credit" giveaway of $8,000/house has ended; and with literally millions of foreclosed homes to be sold by banks or "short sold" by distressed households, residential housing values—falling only slowly for the past four months—will go into a new plunge in the second and third quarter.
In the commercial real estate/securities collapse, the national average commercial real estate market price has now fallen 41% from its 2007 peak, and is continuing to plunge. In 2010, through last week, 64 U.S. banks had failed, totalling $61 billion in assets, more than double the 2009 rate of failures. Of the 100 banks that had the highest ratio, on Jan. 1, of commercial real estate loans to their total capital, 42 have already failed. "Commercial real estate exposure has become a frighteningly accurate predictor of bank health"—or death—reported Fox Business News.
