As shown in a recently released report on nationwide foreclosures for the July to September quarter, New Jersey had over 18,000 of its households notified of default and foreclosure. With a foreclosure rate of one in every 193 residential units, New Jersey ranked 15th among states based on pace of foreclosure.

What is also disturbing about New Jersey is the rate of its increase in foreclosure rate. While its foreclosure rate in the July to September quarter was just around one-percent higher than its rate last year, it was higher than the previous quarter by a staggering 44.6 percent. This means that while the state was not significantly affected at the start of the foreclosure crisis, it is now experiencing difficulties that are driving more residents to foreclosure.

Another serious problem that has reached the offices of housing advocates is the unlawful eviction of tenants from foreclosed properties on sale.

According to officials at the Public Advocate Department of New Jersey, they have already helped over 160 renters who were being evicted illegally from properties in foreclosure. Some renters were being notified by bank representatives that they had to move out of the premises immediately while others were being evicted by sheriffs or were seeing their utilities cut off.

There are laws against unlawful eviction in New Jersey, but banks and real estate agents have been successful in evicting renters because many renting families are not aware that anti-eviction laws exist.

To protect renters throughout the state, the Public Advocate Department has launched a statewide campaign to inform renters about anti-eviction laws and their rights as tenants. They are making renters aware that they have the right to refuse coercive methods such as cash-for-keys, particularly if the cash being offered does not even fully cover the security deposits and advance rents paid.

The department has also notified utility companies to continue providing service to renters even if property owners have stopped paying the bills.

Ronald Chen, who became the first New Jersey Public Advocate in 13 years, issued a proposal that would make renters more prepared in case of foreclosure. He recommended that the courts require lenders to notify renters of the pending foreclosure before courts allow the rentals to become foreclosed properties on sale.

VA also noted that because of the high foreclosure activity, the number of military veterans with no home also rose. To prevent the further increase in homeless rate among veterans, VA launched a five-year program designed to alleviate the homelessness problem among veterans. The agency pledged about 3.2 billion dollars to address the problem that has been plaguing many veterans who served in wars in Iraq and Afghanistan.

VA Secretary Eric K. Shinseki explained that no military veterans who served the country should ever be without a roof on their heads. Industry experts said that previous programs of VA focused on helping homeless veterans. However, with the current program, the focus would be in prevention and at the same time, rescuing veterans from homelessness.

Market data showed that out of 24 million military veterans in the country, 131,000 have no homes, with twice the numbers becoming homeless every year. An estimated 3 percent of these homeless military veterans have served in Afghanistan or Iraq. Results of a study conducted in 2007 showed that Afghanistan and Iraq war veterans lost their homes faster compared with other veterans.

Homeless experts and government officials are concerned that the number of cheap foreclosed house for sale in military bases would increase by as much as 15 percent due to the current economic downturn.

Experts said that veterans are one of the sectors in the society badly hit by the recession. And with unemployment rate more than 12 percent now, the prognosis on their situation remains bleak.

The VA has pledged to provide about $400 million to support initiatives that will prevent homelessness. The agency plans to expand its partnerships with the Department of Housing and Urban Development, Small Business Administration and other veterans programs in the federal, state and local levels. VA also plans to help businesses owned by veterans in qualifying for government contracts and overcoming the current economic downturn.

Industry experts applauded the current efforts of the VA to prevent homelessness and the spread of cheap foreclosed house for sale in military bases.

The cities of Covina, Montebello and La Puente passed laws that require banks and other property owners to track and maintain foreclosure properties on their portfolio. City code enforcement workers said that the abandoned home programs are designed to prevent crime in neighborhoods and to keep properties in good condition to attract buyers.

Residents of these cities said that vacant properties are the favorite hung-outs of teenagers who break in and party in them. Sometimes, squatters live in these abandoned properties and strip away everything that they could sell.

Industry experts said that cheap foreclosed home for sale that are not maintained could bring down the entire neighborhood, including pulling prices and values of surrounding homes. City laws require that banks and mortgage lenders notify local governments about the vacant properties and to maintain these houses.

Since Montebello launched its abandoned property program, nine property owners have already registered. Under the program, banks have to pay a registration fee of $120 for every foreclosed property. Property owners should also maintain the foreclosure homes or pay the fine of as much as $1,000 per day that it fails to provide maintenance or repair on abandoned properties.

In La Puente, its abandoned property law aims to make someone take responsibility for the maintenance of foreclosure homes that have been unoccupied for several months. Since the enactment of the program in November last year, La Puente already registered 51 foreclosure houses.

The program in La Puente is proving to be a success because of the cooperation between code enforcement workers and banks to make sure that vacant, foreclosed houses are in good condition and free of transients.

Aside from blights, city officials are also concerned about stagnant water, such as fountains and pools, which could be a breeding ground for mosquitoes.

According to market data, there were 21,850 cheap foreclosed home for sale in Los Angeles County from July to September, an increase from 17,073 reported for the same period last year. Industry experts said that more foreclosures remained unaccounted because banks are delaying making a report of their losses due to delinquent loans.

A grant totaling $1,330,600 has been presented by Lieutenant Governor Brian Dubie as part of the Neighborhood Stabilization Program (NSP). The NSP is funded by the federal government to help alleviate the impact of the foreclosure crisis and boost the immediate recovery of the housing market.

Dubie explained that the federal grant will help build new housing and preserve affordable housing. Additionally, the program will also help the city economy by creating jobs in the area. Industry experts said that the grant will allow the city to create opportunities out of the devastating foreclosure crisis. One opportunity is to provide a chance to low income individuals and families to become homeowners, with stable and affordable financing.

The city has partnered with Champlain Housing Trust to allow homebuyers obtain affordable financing, education and support for sustainable homeownership. According to the plan, nearly $1 million was allocated to purchase cheap foreclosed home on sale which will be renovated to code standards and placed on the market for sale to eligible buyers.

The purchase price is discounted and renovated houses will be sold on affordable rates to buyers earning 120 percent of the median income in the area. The government subsidy will be retained in each home to provide sustainable and affordable homeownership in coming years.

Meanwhile, about $330,600 of the grant will be given to Cathedral Square Corp. to help in redeveloping the Thayer School. The project is designed to convert the vacant property into mixed-use commercial and residential units. The project will provide affordable rental units to both working and older people.

Early this year, Governor Jim Douglas stated that Vermont will sell the property to Cathedral Square. Industry experts said that the NSP funds allowed the city to start immediately the construction of 100 affordable hoses for low income families and seniors.

They added that the project is a significant contribution for the efforts to alleviate the devastating effects of housing shortage in the city. At the same time, it helps the city eliminate cheap foreclosed home on sale which can become blights in neighborhoods.

The most affordable units are being sold at prices starting at $280,000 while units that offer views of the bay and the city of San Francisco are priced from $600,000 through $850,000. One penthouse has been sold for $1.4 million recently.

The 134-unit condo complex, which is adjacent to Jack London Square, was foreclosed by financial firm Union Labor Life earlier this year after the original developers failed to pay their $77 million loan.

After absorbing a loss of $22 million from the loan, Union Labor chose Emerald Fund to take over the condo development and sell the condo units.

According to Oz Erickson, head of Emerald Fund, the condo units are really great buys not only for investors but also for homeowners because the units were built by the original developers as luxury units, but which are now available at substantially reduced prices.

Erickson also added that the quality of the units and the whole building is among the highest in San Francisco. He reiterated that anyone looking for a great property in foreclosure should take a look at units at The Ellington.

After the foreclosure, the building has been attracting attention not only because of the lower-priced units, but because of the expected contribution of the complex to the restaurant, retail and night life of the Jack London Square and the entire downtown.

William Nork of commercial real estate firm Cornish & Carey said he is glad that the condo complex is now achieving some success. He added that the progress of the development will lift all other projects in the area.

In recent years, the city of Oakland has been trying to encourage downtown residential development under its 10K project, which aimed to build thousands of housing units for people that will work and live downtown and will spend their money in shops and restaurants. All these activities were expected to rejuvenate downtown, to encourage the influx of people into the city and help the city more vibrant.

According to Erickson, sales have also been improving because of the approval of its application for Fannie Mae guarantees. Now, anyone buying a property in foreclosure in the complex can get affordable financing more easily.

South Florida is one of the regions in the country that was badly hit by the foreclosure crisis. The crisis brought devastation to the region in the form of record low home prices and values, unemployment and growing number of cheap foreclosed homes on sale.

The foreclosure crisis has brought life-wreaking impact on millions of homeowners. But some entrepreneurs and professionals found ways to turn a bad and hopeless situation into an income generating endeavor.

Some entrepreneurs purchased notes at very low prices and then reducing the monthly mortgages of borrowers to help them avoid foreclosures. Others buy large volume of bargain-priced foreclosure properties.

According to industry experts, the opportunities that came out of the current housing market in South Florida are expected to go on for another two years as the number of foreclosure filings continued to swamp the state’s court system and the number of homeowners losing their jobs is getting high.

Experts pointed out that people who had the inkling of what is going to happen and had bolt out of the market had found opportunities to profit from the foreclosure crisis.

Peter Zalewski, a former journalist, established his foreclosure consulting and specialty real estate firm to help homeowners avoid foreclosures. Three years after he started operation, he already has 36 staff to address cash investors’ growing demand for bargain-priced foreclosure houses.

His story and business operation caught the interest of movie director Michael Moore while he was on the process of making his documentary, entitled “Capitalism: A Love Story.”

Meanwhile, Giving Tree Development’s Jeff Waters buys notes at discounted prices and then reduced the monthly mortgage payments of distressed borrowers to help avoid foreclosures.

He started his initiative last year and soon discovered that it is possible to purchase distressed loans one after the other, rather than buying them in bulk of 200 homes or more. The process involves investors or companies buying a note, then homeowners will be approached and informed that they have a new loan service and will be offered with loan modification.

These are just some innovative ways to help stave off the number of cheap foreclosed homes on sale. The efforts do not result to a dramatic decline in foreclosure rates but combining all the housing recovery initiatives may help make a dent on the continuing problem, experts said.

Last month, year-to-year home sales increased by 34 percent to 14,419 compared with 10,778 in the same month the previous year. Also, home sales in September represented a 4.1 percent increase compared with August sales activity.

On the other hand, market data showed that sales of condominiums across the state rose by 77 percent last month from the same month a year ago. September condominium sales also represented an 8.9 percent increase over the total number of houses sold in August.

All metropolitan statistical areas (MSA) in Florida posted home sales increases last month. Similarly, condominium sales also increased in all MSAs except one. According to market data, majority of Florida MSAs reported sales increases for 15 straight months.

Meanwhile, the median home sales price in Florida dropped to $142,000 last month from a year ago $174,900, representing a 19 percent decline. Housing analysts said that cheap foreclosed house sales remained to be the major contributor in home sales gains.

They said that foreclosure properties pulled down home prices and values in the state. However, low-priced houses are what attracted first-time buyers to flock to the state and use their federal tax credit of $8,000 to make home purchases.

Nationwide, the median sales price for single-family houses was $177,500 in August, a drop of 12.1 percent compared with the previous year. Massachusetts posted median resale price of $315,000, $292,960 in California, $205,000 in New York and $265,862 in Maryland.

Industry experts note several positive signs pointing towards a housing market recovery. Foremost of these signs is the rising home sales in several areas in the country where foreclosure rates are high.

They believed that extending and expanding the federal tax credit for first-time homebuyers would greatly help in stabilizing home prices and expediting the recovery of the housing market. They pointed out that the federal tax credit is the best housing recovery program so far of the Obama Administration.

They added that the program not only encouraged homeownership but also help reduce the number of cheap foreclosed house that is glutting the market and affecting home prices and values.

According to the report, there was a significant improvement in the housing demand, albeit at a slow pace. The trend in the housing market was a remarkable contrast to the commercial real estate market which is eroding further.

Home sales have been increasing in some parts of the Western region, accompanied by increases in home prices. However, the report noted that the momentum of the real estate market recovery has been hindered by continuing increases in the number of foreclosed property on sale. The increasing foreclosure rates are being blamed for slowing the drop in the inventory of homes on the market for sale.

Because of the abundant supply of cheap foreclosure properties on the market, new home construction rate is slow to pick up throughout the region. Noting the trend, industry experts said that there is no or little possibility that the construction industry will experience a resurgence of activity in the near future.

Meanwhile, in the commercial real estate market, conditions continued to grow worse as demand for industrial and office space drop further and financings for new development projects and purchases remained at a standstill.

In its July report, the agency noted that conditions in the housing markets in the Western region was very weak but was showing significant signs of improvement. Even then, the report already noted the deteriorating condition in the commercial real estate market. In the same report, sales prices for existing and new houses drop further in many areas in the region while activity in the housing construction sector remained at historic low levels.

Nationwide, market data showed that the number of foreclosure filings increased by 5 percent in the third quarter of this year. This means that 937,840 homeowners received at least one foreclosure filing during the period.

In September, 343,638 foreclosed property on sale were reported, a decline of 4 percent from August but an increase of 29 percent from September of the previous year.

The prognosis belies expectations in the past several months that home prices are starting to bottom out. This time, the verdict is out about national home prices falling much lower. Industry experts predicted that home values will fall in 342 housing markets, out of the total 381 nationwide, before the year ends.

Similarly, the median home price nationwide is predicted to fall by nearly 11.3 percent by June 30 next year. Furthermore, it is expected that prices will start to stabilize by rising 3.6 percent sometime next year.

Economists said that more home price drops are expected because the housing market is still inundated with cheap foreclosed houses for sale, with no letting up seen in the very near future. They said that areas with high foreclosure rates will experience the biggest price drops.

For example, in Miami, Florida, prices are predicted to drop by as much as 29.9 percent by June 2010. This home price drop is expected to occur after the city already experienced a 48 percent decline since 2007. By June 2011, Miami’s median home price will plunge to $142,000.

Meanwhile, in Orlando, Florida, a 27 percent home price drop is expected by June of next year to be followed by a moderate decline the following year. Similarly, in Hanford, California, home prices are expected to decline 26.9 percent and to continue to fall by 9.5 percent in 2011.

Home prices are expected to dive by as much as 26.8 percent in Naples, Florida before it will start to flatten out.

On a lighter note, some cities across the country are expected to buck the trend. About 33 housing markets are expected to post price gains while six will remain flat. The gainers will be led by Kennewick, Washington with 8.9 percent increase since 2007 and projected 3.4 percent gain by June 2010.

Other cities that are expected to overcome the impact of cheap foreclosed homes for sale by posting home price gains are Fairbanks and Anchorage both in Alaska and Elmira, New York.

• Miami Foreclosure Properties
• Orlando Foreclosure Properties
• Hanford Foreclosure Properties
• Naples foreclosure properties
• Kennewick foreclosure properties
• Elmira foreclosure properties

Many homeowners who attended the sale of about 175 properties said that they want to know about the available options for them. According to industry experts, properties sold at the sheriff’s sale started as filings of foreclosure filed at the York County Prothonotary’s Office.

For the first eight months of this year, the average monthly foreclosure filings totaled 177. Experts said the number of filings for foreclosure property for sale average 142 for a total of 1,702 last year. They said that with the current trend, there is little chance that foreclosure listings will decline even if it takes almost a year before distressed properties would be placed on the sheriff’s sale.

Meanwhile, foreclosure experts warned potential bidders to arm themselves with knowledge about sheriff’s sales to avoid the risk of financial ruin. They said that a sheriff’s sale is for buyers who have patience and perseverance, adding that it is imperative that bidders should know what they are doing.

The sheriff’s sales are held every 45 days. The process involves making county properties that were either foreclosed or with financial problems available for the public to buy. Industry experts said that potential bidders should be knowledgeable about the process to succeed in sheriff’s sales.

Before attending a foreclosure sale, potential buyers should make sure that they are not bidding on properties that are burdened with liens, such as back taxes and first mortgage debt for houses with second mortgage. They advised buyers to do some title search on properties, especially with those that have second mortgage.

Also, buyers should make sure that the properties they are interested in are vacant to eliminate the trouble of going through an eviction proceedings. If there are tenants on the property, prospective bidders should abide by existing lease terms.

Experts also pointed out that buyers should keep in mind that a foreclosure property for sale is not always in good condition. Getting a home inspection is important if they want to protect their investment.