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Prices Rose Despite Hike in FHLMC Foreclosures in Pittsburgh



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By : John Cutts    99 or more times read
Home prices increased in the first quarter in metro Pittsburgh despite the surge in FHLMC foreclosures and other foreclosed homes in the area.

The price median in the Pittsburgh area surged by 12.2 percent to $116,000 in the first quarter this year, up from $103,400 one year earlier and up by 1.5 percent from $114,300 from the previous quarter. Based on sales data from 152 metro areas tracked by the National Association of Realtors, only 91 posted year-over-year price increases.

During the same quarter, a total of 3,246 Pittsburgh pre foreclosures and completed foreclosures were posted, accounting for 0.3 percent of all households in the area. Foreclosure activity surged by 22 percent from the previous quarter and by 3.2 percent from the first quarter in 2009.

Despite efforts by the Federal Home Loan Mortgage Corporation or Freddie Mac to help owners of guaranteed homes through the Home Affordable Modification Program, a lot of these Freddie-guaranteed homes defaulted and were subsequently taken back.

Similarly, foreclosure filings statewide increased during the same quarter, with a total of 14,709 homes defaulting and 3,536 units becoming home foreclosures for sale. Despite the rise in prices in certain areas, total sales increased because a number of buyers had opportunities to buy Pennsylvania cheap houses.

At the end of December 2009, a total of 45,047 FHLMC foreclosures nationwide were counted. This number has certainly increased because the default rate for Freddie home loans in March was 4.13 percent, up from 2.41 percent one year earlier. As of the latest report, Freddie and Fannie own 50 percent of all home loans throughout the U.S., which have grown to a total of $11 trillion.

Additionally, based on reports from the Office of the Comptroller of the Currency, more than 57 percent of all Freddie Mac home loans redefaulted one year after loan modification.

Because of FHLMC foreclosures and other costs paid, Freddie lost $8 billion in the first quarter, necessitating the agency to ask for another $10.6 billion in aid from the federal government.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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