Markets: The market for foreclosure cleanup and property preservation services continues to remain very strong and high growth is predicted into both 2011 and 2012. In late November 2010, the Federal Reserve revealed that it expects approximately 4.25 million more foreclosure filings in the next two years, with two million plus expected in 2011 as well as in 2012, as reported to a congressional subcommittee by the Reserve Governor Elizabeth Duke. To put these numbers in perspective, this amount is similar to the number of foreclosures that occurred during 2010. The report also disclosed that about five million mortgages are currently 90 days past due or more. According to RealtyTrac.com, a leading foreclosure sales website and research firm, there were 262,339 new foreclosures in November 2010 alone which equates to 1 in every 492 housing units receiving a filing notice. Rick Sharga, a senior vice president at RealtyTrac, in Irvine California, says the size of the Foreclosure Economy is tough to measure. But he estimates that the value of foreclosed real estate itself is in the hundreds of billions of dollars. RealtyTrac estimates that the average foreclosed home is worth $175,000, and that the total value of the 1.2 million homes expected to be seized this year is about $210 billion. That's in addition to the $157 billion in home value that banks already have on their books. Before the recent halt, foreclosures accounted for about one-in-four home sales.
Customers: We provide REO Preservation & Maintenance field services to the following types of customers:
1. In house REO asset managers for banks and financial institutions
2. Asset Managers for third-party disposition service providers
3. REO Brokers and Realtors who have been given authority to hire vendors
4. Other REO representatives hiring vendors
5. Wholesale investors
6. Individual investors
7. Individual homeowners purchasing an REO at an auction or directly from a bank which has done no work to the property
8. Government agencies specializing in real estate
At National Asset Protection Agency, LLC, we will provide high-quality, timely and competitively priced foreclosure cleanup / property preservation field services to customers who need to cleanup, preserve, protect, remodel and beautify a property after foreclosure.
Outlook: Foreclosures continue to rise on account of the following conditions in the United States:
1. Continued overall poor economic conditions in the US
2. High unemployment rates (unemployment = inability to repay debt)
3. Historically low interest rates are slowly rising
4. Adjustable rate mortgages set to increase in 2011
a. The ten year ARMs from 2001
b. The seven year ARMs from 2004
c. The five year ARMs from 2006
d. A few three year ARMs from 2008
e. The four waves of arms that reset in the year 2010 and many other types of creative financing (“Toxic Mortgages”) continue to put pressure on homeowners
5. Homeowners choosing to strategically default (i.e. allow their house to foreclose in an effort to mitigate losses in equity, whether they are delinquent or not)
6. Tighter lending standards = less people qualify for a mortgage = unable to purchase a home from the growing supply of houses on the market
These above trends are significantly contributing factors in the forecasted two million (2,000,000) foreclosures predicted to occur in each of the next two years of 2011 and 2012. Taking all of this information into consideration, we can say with confidence that market data highly suggests a strong market for foreclosure cleanup and property preservation services.