John Rebchook is a former Rocky Mountain News reporter with more than 30 years of experience in writing and communications... 
HUD has priced a one-bedroom, one-bath condo unit in this building at 8707 E. Florida Ave. at $89,000.
The U.S. Department of Housing and Urban Development has acquired 15 percent fewer foreclosed homes in Colorado in the first nine months of this year, compared to the same period in 2008, shows information obtained by InsideRealEstateNews.com.
And in Denver, the number of homes with Federal Housing Administration-insured loans that HUD acquired dropped by 20.4 percent. (FHA is part of HUD.)
By contrast, the overall decline in statewide homes sold by public trustees at auctions fell by about 10 percent in the first nine months of 2009, compared with the same period in 2008, according to the Colorado Division of Housing.
“I will share with you that the FHA never strayed away from our underwriting guidelines and we have withstood the test of time,” said Deborah Griswold, deputy director for HUD’s Region VIII, which includes Colorado.
Data requested by InsideRealEstateNews.com shows that HUD acquired 2,310 homes in Colorado with FHA-loans in the first nine months of the year, compared with 2,720 in the same period of 2008. In the Denver area, it acquired 1,557 homes this year, compared with 1,958 last yera.
George Antoine, a HUD economist with Region VIII, said that Colorado’s place in the economic cycle, also helps.
“We in Colorado started our downturn earlier than most cities in the nation, and we never had the housing bubble the rest of the country had,” Antoine said. “We started adjusting to the downturn before most states. I think we were still weakened from the dot.com bust (in 2000 and 2001) and had not fully recovered from it, when the housing downturn started.”
The Denver area, he noted, did not become severely over-built with new homes, as many other parts of the country that are now paying the price, he said.
The 2,310 HUD foreclosures represent 15.4 percent of the 14,971 public trustee foreclosure sales tracked by the state’s housing division.
“That is not an inconsequential percentage,” said Ryan McMaken, spokesman for the division. “I would say that the statistics are not all the surprising and would be expected. We know on a national level that the FHA foreclosures are rising, but they are more conservative loans than many of the other conventional loan programs that were out there.”
Some of the most onerous loans, did not require verification of work history, for example, which FHA requires before it will insure a mortgage.
Still, as FHA loans become a bigger part of the new loan market, it will be critical to watch to see if the percentage of defaults also rises, McMaken said.
On the other hand, housing counselors working with distressed home owners, prefer those with FHA loans as opposed to conventional loans, he said. Dealing with the FHA loans is much more straightforward and faster than dealing with conventional loans that are more complicated because of the investor structure, which will vary from loan to loan.
Related blog:
Baffling drop in HUD sale prices.
HUD inventory could contribute to shadow market.
HUD acquisitions in 1st 9 months.
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Year Colorado Denver
2008 2,720 1,958
2009 2,310 1,557
Source: HUD Single Family Data Warehouse.
[...] « FHA loans soar in Denver, Colorado HUD foreclosures drop by 15% [...]
Great report, great stats. It is great to see what is happening around the country. In our market, California's Central Valley: Stanislaus and San Joaquin counties–we are seeing a tremendous amount of short sales while the banks are holding off on foreclosing. This has created a shortage of inventory resulting in sellers choosing buyers with conventional loans over FHA. This will eventually lower the amount of FHA foreclosures as there have been a lower rate of FHA origination. http://www.jeffgreen.pmz.com
John,
Great information. Mike
Colorado Real Estate