As the news of Subprime foreclosures increases its dominance in the media and as more and more dire news comes out about our economy, it begins to manifest itself here in Rochester, even though most of the problems associated with the ARM market are well away from our modestly-priced homes.  The RBJ reports that local sales of homes decreased a breath-taking 27% from January to February.  This despite the fact that home values in Rochester have actually seen an 11% jump since this time last year, unlike elsewhere.  Also, the stock of available homes in Rochester is decreasing slightly, which will also serve to keep our home prices steadily rising.

Irondequoit just increased the assesments of their homes and that made the news, but an 11 jump across the board is definitely worth noting. . .

Elsewhere, a source close to me who has been dealing with a subprime mortgage in foreclosure just told me that the bank called them and unilaterally renegotiated the price and mortgage on the home.  One minute, they were demanding $3000 or the mortgage was going bye-bye; the next minute, they told the borrowers what the new mortgage price would be and that there would be no escrow for taxes and insurance.  No questions, no explanations, that’s it.

This may or may not indicate a tipping point, wherein banks have finally decided that taking a loss on one property that’s still generating revenue is better than taking a loss on a property that is sitting empty and generating squat.  That makes some sense, given the level of foreclosure across the country, and there’s no wisdom in shaking what is an otherwise stable realty market in Rochester.  Time will tell.

I’m curious to see if other borrowers have experienced this same curious turning?  If you’ve had similar dealings or know someone who has, please contact me and let me know.  We can keep your information confidential!