Higher Unemployment Means Many More Distressed Properties to Come
A panel meeting today at the Safeguard Properties National Property Preservation Conference in Washington DC shifted gears to address the "unexpected" jump in unemployment rates. Unemployment in the United States now stands at 10.2%, somewhat beyond the forecast of economists. The US Conference of Mayors, a nonpartisan organization that represents cities with populations greater than 30,000, is sending out an industry warning that they expect employment rates to continue to climb in 2010, reaching levels as high as 15% in some municipalities. Servicers in these areas should prepare to face a much heavier distressed asset portfolio as borrowers struggle to cope with lose of income, says Dave Gatton, a director at the firm. Gatton added that local government received very little amounts of bailout money and will likely not have an infrastructure to support these servicers. Servicers, investors and regulators will convene later this month in Austin, Texas at a HousingWire-sponsored, invitation-only event -- Distressed Servicing 2009 -- to discuss industry challenges posed by the growing presence of distressed properties. Write to Jacob Gaffney.