Michigan Researcher Says Foreclosures To Fall

Ann Arbor, MI, Dec. 7, 2009--A University of Michigan researcher is predicting that foreclosures will begin to fall next year, dropping from 2.75 million in 2009 to about 1.75 million in 2010 and 2011.

They will decline to less than an annual 1.5 million by 2012, said Dennis Capozza, professor of finance and real estate at Michigan's Ross School of Business.

The drop in foreclosures will be due to better national and local economic conditions, including a strengthening economy, slower house-price depreciation and tighter underwriting of mortgages, he said.

"The improvement in foreclosures will provide relief to the severely battered mortgage and housing markets," Capozza said in a news release earlier this week.

"For the time being, however, steep increases in unemployment are continuing to mitigate the positive factors, which means that housing markets will continue to take a beating for some time, despite federal stimulus incentives."