August Foreclosures

According to figures released by RealtyTrac, a marketer of foreclosed properties, there were 243,947 foreclures in the month of August. That's up from 115,292 in August 2006 and 36% higher than July's numbers.

"The jump in foreclosure filings this month might be the beginning of the next wave of increased foreclosure activity, as a large number of subprime adjustable rate loans are beginning to reset now," James Saccacio, chief executive of RealtyTrac, said in a statement.

The hardest hit was Nevada which had 1 foreclosure for every 165 households. Overall the Midwest and the South were the hardest hit, but every state is feeling the pinch. Real estate prices that went unchecked for so many years, funded largely by sub-prime loans, have been the doomsayer for investors, brokers, agents and home owners alike for the past two years. Surely our greed will be our undoing.

Where does that leave a new investor like me?

Often times scratching my head, trying to figure out how I'm going to make this thing work.

But check this out...

1. A real estate agent friend of mine told me that he has pre-foreclousre homes in northern Virginia that I can buy, priced at up to 80% below their tax appraisal.

2. I spend a lot of time researching the history of individual homes sales. Houses these days are frequently appraised well below their numbers from a few years ago. I saw a house just outside the Beltway that sold for $2.2 million in 2004. Today, the same house is appraised at $465K.

The bottom line is this, the opportunities are out there for those savvy investors who know, or can learn, how to make the market work for them.