There’s an 800-pound gorilla in the nation’s hardest-hit housing markets: hundreds of thousands of foreclosed properties are selling, and there’s four times as many potential foreclosures behind them.

The Journal writes today that one idea gaining support in Washington is an effort to pull some of those properties off the market and rent them out, either on homes owned by federal agencies or loan giants Fannie Mae and Freddie Mac.

These firms and U.S. banks currently own more than 500,000 foreclosed homes, and there’s another 2 million loans in some stage of foreclosure. The high share of distressed sales in many struggling markets is contributing to continued declines in home prices.

“Can we find a way to try and reduce that overhang or to try to provide incentives for investors to covert them?” said Federal Reserve Chairman Ben Bernanke in testimony to Congress last week.

RealtyTrac estimates that 1 million foreclosure-related notices that should have been filed by banks this year will be pushed to next year. The filings include notices for defaults, scheduled home auctions and home repossessions.

The delayed filings buys more time for many borrowers behind in payments to remain in their homes, perhaps giving them time to catch up or simply to stall their inevitable eviction. But it also means any eventual foreclosures will happen next year, extending the shadow of distressed properties that hovers over the market.

"The best-case scenario is we don't get back to normal levels of foreclosure activity until 2015, which means the housing market recovery gets delayed by at least a year," said Rick Sharga, a senior vice president at RealtyTrac.

And given delays in the time it's taking lenders to move a home from default to foreclosure and then sell the property, the housing turnaround could conceivably be pushed out to as late as 2016, Sharga said.

If the U.S. economy were a neighborhood, the housing market would be the Boo Radleys: the one weird neighbor who doesn’t mow his lawn, lets his house fall to pieces and generally drives down resale values for the whole street.

Put another way, the slumping housing market is serving as a drag on the broader American economy as it struggles to recover the effects of the Great Recession. Further evidence came Tuesday from the National Realtors Association, whose monthly data showed sales of existing homes fell by 3.8 percent in May. This puts the projected annual total for 2011 at just over 4.8 million – a figure that lags behind even last year’s dismal showing. And last year was the worst in thirteen years.

“All the programs – going back to the ones that [President George W.] Bush instituted and the ones that [President] Obama has instituted – have turned out to be [unable] to do anything to raise the state of the housing market,”

It's official: The housing crisis that began in 2006 and has recently entered a double dip is now worse than the Great Depression.

Prices have fallen some 33 percent since the market began its collapse, greater than the 31 percent fall that began in the late 1920s and culminated in the early 1930s, according to Case-Shiller data.

The news comes as the Federal Reserve considers whether the economy has regained enough strength to stand on its own and as unemployment remains at a still-elevated 9.1 percent, throwing into question whether the recovery is real.

"The sharp fall in house prices in the first quarter provided further confirmation that this housing crash has been larger and faster than the one during the Great Depression," Paul Dales, senior economist at Capital Economics in Toronto, wrote in research for clients.

According to Case-Shiller, which provides the most closely followed housing industry data, prices dropped 1.9 percent in the first quarter,

As the recession gripped America, thousands more people in rural and suburban areas turned to homeless shelters for help.

The number of people using shelters or transitional housing in suburban and rural areas increased 57 percent from 2007 to 2010, with more than 500,000 people from smaller communities seeking help in 2010, according to a report by the Housing and Urban Development Department. During the same time there was a decrease in the use of shelters in urban areas.

HUD Secretary Shaun Donovan said Tuesday in a conference call with reporters that about 40 percent of those who served in the armed forces come from rural areas and homelessness among Iraq and Afghanistan veterans could be a contributing factor. He said the agency is stepping up efforts to combat homelessness near some military bases, and that legislation signed in 2009 by President Barack Obama contained a component that opens the door for more programs targeting homelessness in rural areas.

If you thought the housing crisis was bad, think again. It’s worse.

New data just out from Zillow, the real-estate information company, show house prices are falling at their fastest rate since the Lehman collapse.

Average home prices are down 8% from a year ago, 3% over the quarter, and are falling at about 1% every month, according to Zillow.
And the percentage of homeowners in negative-equity positions — with a home worth less than its mortgage — has rocketed to 28%, a new crisis high.
Zillow now predicts prices will fall about 8% this year and says it no longer expects the market to bottom before 2012.
“There’s no way we can get to flat, from these depreciation levels, in the last nine months of the year,” says Zillow economist Stan Humphries. “Demand is a lot more anemic than we had previously thought.”

The Housing and Economic Recovery Act of 2008 authorizes a $7,500 tax credit for qualified first-time home buyers purchasing homes on or after April 9, 2008 and before July 1, 2009. The following questions and answers provide basic information about the tax credit.