According to this Indianapolis Star article, Indiana leads the nation in foreclosure proceedings since July 2004.
Foreclosures in Indiana are driven by factory layoffs, personal bankruptcies, stagnant home prices and aggressive lending.During
the last quarter of 2005, lenders started foreclosure proceedings on 7,575 Indiana mortgage loans, or 0.98 percent of mortgage loans in service statewide, the Mortgage Bankers Association reported.That
rate was more than double the nation’s rate and was Indiana’s highest since association records were begun in 1979. “You haven’t had a lot of home price appreciation, and you’ve lost a lot of manufacturing jobs,” said Jay Brinkman, vice president for research and economics at the Washington trade group.
HOUSING BUBBLE IN INDIANA????
Gee how can that be? After all there has been little if any home appreciation. Which only raises the question why are the national homebuilders continuing to convert more and more Indiana farm land to subdivisions? People say there can not be a “Housing Bubble” in Central Indiana, since appreciation rates have been well below those of the Blue State/Coasts/SunBelt.
Instead I would argue that Indiana is just as cursed with the Housing Bubble plaque as the rest of the nation. Look at the signs. You have a very very weak rental market. The cost to rent vs owning is making renting a bargain compared to the risks of ownership. Real wages in Indiana are either falling or not keeping up with the National average.
Last what the F*** is up with all the new home construction. Does it have to do with the fact that the National HomeBuilders are more concerned with pleasing Wall Street by maintaining marketshare then obeying traditional housing market fundementals? Home building is a traditionally a cyclical industry. Rarely has a homebuilding boom continued year in year out for more than 3-5 years. This housing boom has been going on for over 8 years. Look at the insider selling going at at many of the national homebuilders even as they keep adding to their inventory. Enron anyone????
Also what they hell are folks thinking. No matter what the billboards lining I-465 say, buying a home has never been, until Greenspan came along at least and outside a handful of bubble prone markets on the coasts, an INVESTMENT for the middle class. Traditional wisdom was you buy a home because you need a place to live inorder to raise a family and hedge against inflation.
Just wait as later this year people with adjustable rate morgages get hit with morgage payment adjustments. Hell they can barely handle the skyrocketing costs of heating with natural gas. Can anyone say KABOOM!!!!
And our Pea-Brained Governor’s solutions to Indiana’s economic woes is to build more interstates inorder to fuel more suburban sprawl. Gee just who is going to buy more of those cookie cutter suburban track homes.
If you want to learn about or debate the HOUSING BUBBLE visit
http://thehousingbubbleblog.com/