First-Time Foreclosed Home for Sale Buying in Illinois

First-time foreclosed home for sale buying in Chicago, Illinois is increasing, driving home sales up and giving hope to real estate experts that the housing market is on its way to recovery. And first-time homebuyers are grabbing bargain foreclosure properties despite their deteriorating condition.

Data from the National Association of Realtors showed that 50 percent of sales generated in the first quarter of this year were attributed to first-time homebuyers. And 50 percent of these sales consisted of repossessed homes.

Repossessed properties that have become popular to first-time homebuyers are foreclosed homes and short sales, private deals in which the distressed homeowner sells his house for less than the total amount he owed on his mortgage.

The unabated foreclosure crisis has created a glut of distressed homes on the market and pushed down property values. And first-time homebuyers are quick to take advantage of the below market value properties, a trend that benefited neighborhoods and housing market.

RW Real Estate Advisors principal Lance Ramella explained that the first step towards the housing market recovery is selling below market value properties and those are foreclosures. He pointed out that the real estate industry will not see any sustainable price increase until foreclosure properties will be taken out of the inventory list.

However, industry experts believed that zeroing out foreclosure properties on the inventory will take some time as lenders are once again initiating foreclosure proceedings following the lifting of the industrywide foreclosure moratoriums.

They also believed that efforts to modify or refinance troubled loans could not help the increasing number of homeowners who are unable to make mortgage payment because they have lost their job.

Based on RealtyTrac data, 38,966 properties in Illinois received foreclosure filings during the first three months of this year, a 32 percent rise from the last quarter of 2008 and 68 percent higher from figures in the first quarter of 2008.

One out of 135 houses in Illinois received foreclosure filings during the first quarter. This means that the state has the fifth highest foreclosure rate in the nation. For March of this year, foreclosure filings were received by 15,398 homeowners, representing an 8 percent rise from February and 79 percent increase from the total March 2008 figures. James J. Saccacio, chief executive officer of RealtyTrac, said that Illinois lost over 230,000 jobs since 2008 and experienced a significant decline in home sales. He also added that these factors helped drive the number of foreclosed home for sale at peak levels.

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