Monthly Activityat Lowest Level Since July 2007 Led by Drops in CA, MI, GA, TX,AZ
Lowest Quarterly Total Since Q42007, But Activity Increasing in FL, IL, OH, NY, NJ
IRVINE,Calif. – Oct. 11, 2012 — RealtyTrac® (www.realtytrac.com), theleading online marketplace for foreclosure properties, today released its U.S.Foreclosure Market Report™ for September and the third quarter of 2012, whichshows foreclosure filings — default notices, scheduled auctions and bankrepossessions — were reported on 180,427 U.S. properties inSeptember, a decrease of 7 percent from the previous month and down 16 percentfrom September 2011. September’s total was the lowest U.S. total since July2007.
The decrease in September helpeddrop the third quarter foreclosure numbers to the lowest level since the fourthquarter of 2007. Foreclosure filings were reported on 531,576 U.S. propertiesduring the quarter, a decrease of 5 percent from the second quarter and adecrease of 13 percent from the third quarter of 2011 — the ninth consecutivequarter with an annual decrease in foreclosure activity. The report also showsone in every 248 U.S. housing units with a foreclosure filing during thequarter.
“We’ve been waiting for the other foreclosure shoeto drop since late 2010, when questionable foreclosure practices slowedactivity to a crawl in many areas, but that other shoe is instead beingcarefully lowered to the floor and therefore making little noise in the housingmarket — at least at a national level,” said Daren Blomquist, vice president atRealtyTrac. “Make no mistake, however, the other shoe is dropping quite loudlyin certain states, primarily those where foreclosure activity was held back themost last year.
“Meanwhile, several states where theforeclosure flow was not so dammed up last year could see a roller-coasterpattern in foreclosure activity going forward because of recent legislation orcourt rulings that substantively change the rules to properly foreclose,” Blomquistadded. “A backlog of delayed foreclosures will likely build up in those statesas lenders adjust to the new rules, with many of those delayed foreclosureseventually hitting down the road.”
Otherhigh-level findings from the report
- The national decrease in September and the third quarter was driven mostly bysizable decreases in the non-judicial foreclosure states such as California,Georgia, Texas, Arizona and Michigan.
- Several judicial foreclosure states — including Florida, Illinois, Ohio, NewJersey and New York — continued to buck the national trend, registeringsubstantial year-over-year increases in foreclosure activity in September andthe third quarter.
- U.S. foreclosurestarts in the third quarter decreased both from the previous quarter and a yearago, reversing a bump in foreclosure starts in the secondquarter.
- California foreclosurestarts (NOD) in September decreased 18 percent from the previous month and weredown 45 percent from a year ago to a 69-month low, although the state’sforeclosure rate still ranked in the top three for the month andquarter.
- Florida foreclosure starts(LIS) in September increased 24 percent on a year-over-year basis, the 11thconsecutive month with an annual increase, and the state’s foreclosure rateranked highest nationwide for the first time since April2005.
Non-judicial states pushnational numbers lower
Of the 24 states where the non-judicialforeclosure process is primarily utilized, 20 reported annualdecreases in foreclosure activity in the third quarter, including Nevada (71percent decrease), Oregon (63 percent decrease), Utah (60 percent decrease),Virginia (34 percent decrease), California (29 percent decrease), Michigan (28percent decrease), Arizona (23 percent decrease), Colorado (21 percentdecrease), Georgia (20 percent decrease) and Texas (17 percent decrease).
Nevada,Oregon and California have all enacted legislation within the past year addingmore requirements for lenders to properly foreclose, while a Georgia Court ofAppeals ruling in July of this year requires lenders to provide certain informationon foreclosure notices that some lenders may not have been includingpreviously.
Washington state was one of only fournon-judicial foreclosure states where foreclosure activity increased in thethird quarter, up 70 percent from the previous quarter and up 15 percent fromthe third quarter of 2011. Washington state was one of the first non-judicialstates to enact legislation impacting the foreclosure process following theso-called robo-signing controversy that came to light in October 2010. Thestate legislature passed a law that took effect in July 2011, requiring lendersto offer mediation to homeowners facing foreclosure.
Judicial states bucknational trend
Meanwhile, third quarter foreclosureactivity increased on a year-over-year basis in 14 out of the 26 states with aprimarily judicialforeclosure process, including New Jersey (130 percent increase), NewYork (53 percent increase), Indiana (36 percent increase), Pennsylvania (35percent increase), Connecticut (34 percent increase), Illinois (31 percentincrease), Maryland (28 percent increase), South Carolina (16 percentincrease), North Carolina (14 percent increase), and Florida (14 percentincrease).
Some notable exceptions where foreclosureactivity in the third quarter decreased on annual basis in judicial foreclosurestates included Massachusetts (16 percent decrease) and Wisconsin (12 percentdecrease).
Foreclosure starts reverse upwardtrend
First-time foreclosure starts, either defaultnotices or scheduledforeclosure auctions depending on the state’s foreclosure process,were filed on 284,720 U.S. properties during the third quarter, an 8 percentdecrease from the second quarter and also an 8 percent decrease from the thirdquarter of 2011.
Nationwide foreclosure starts decreased onan annual basis for the second straight month in September following threestraight months of annual increases. Foreclosures were started on 87,066 U.S.properties during the month, down 12 percent from August and down 15 percentfrom September 2011.
September foreclosure starts decreasedon an annual basis in 31 states, including California (45 percent decrease),Arizona (34 percent decrease), Michigan (22 percent decrease), Georgia (21percent decrease) and Texas (19 percent decrease).
Stateswith the biggest annual increases in foreclosure starts in September includedNew Jersey (424 percent increase), Pennsylvania (134 percent increase), NewYork (95 percent increase), Washington (60 percent increase) and Florida (24percent increase).
Florida, Arizona, Californiapost top state foreclosure rates in third quarter
Floridaforeclosure activity in the third quarter increased 14 percent from ayear ago, the third consecutive quarter with an annual increase and boostingthe state’s foreclosure rate to highest in the nation. One in every 117 Floridahousing units had a foreclosure filing in the third quarter, more than twicethe national average.
Florida’s foreclosure rate also rankedhighest in the nation in September, the first time since April 2005 thatFlorida has held the No. 1 spot. Florida foreclosure starts in Septemberincreased 24 percent from a year ago — the 11th straight month with an annualincrease — and Florida bank repossessions (REO) increased 23 percent year overyear — the ninth straight month with an annual increase.
ArizonaREOs in September increased 2 percent from a year ago, the firstyear-over-year increase in Arizona REOs since November 2011, but the state’soverall foreclosure activity was down on an annual basis both in September andthe third quarter thanks to big drops in foreclosure starts. Despite thosedecreases, one in every 125 Arizona housing units had a foreclosure filingduring the third quarter — the nation’s second highest state foreclosurerate.
California also posted a foreclosure rate of one inevery 125 housing units with a foreclosure filing in the third quarter, but thestate’s foreclosure rate was slightly lower than that of Arizona, ranking No. 3among all states for the quarter. A total of 109,369 California properties hadforeclosure filings during the quarter, the highest of any state but still downfrom the previous quarter and a year ago.
Californiaforeclosure auctions and REOs in the third quarter both increasedfrom the previous quarter, but foreclosure starts (NODs) dropped 19 percentfrom the previous quarter. California foreclosure starts in September droppedto their lowest level since December 2006 — a 69-monthlow.
Other states with foreclosure rates ranking among thetop 10 in the third quarter were Illinois (one in 126 housing units with aforeclosure filing), Georgia (one in 151), Nevada (one in 158), Ohio (one in197), Michigan (one in 201), South Carolina (one in 215), and Colorado (one in216).
Days to foreclose at record 382 days,legislation extends process in some states
U.S.properties foreclosed in the third quarter took an average of 382 days to completethe foreclosure process, up from 378 days in the previous quarter and up from336 days in the third quarter of 2011. It was the highest average number ofdays to foreclose going back to the first quarter of2007.
The average time to complete a foreclosure increasedsubstantially from a year ago in several states where recent legislation andcourt rulings have extended the foreclosure process. These states includedOregon (up 62 percent to 193 days), Hawaii (up 62 percent to 662 days),Washington (up 62 percent to 248 days) and Nevada (up 42 percent to 520days).
The average time to foreclose decreased from a yearago in 15 states, including Arkansas (down 49 percent to 199 days), Michigan(down 15 percent to 226 days), Maryland (down 9 percent to 541 days),California (down 8 percent to 335 days), and New Jersey (down 4 percent to 931days).
New Jersey documented the second longest stateforeclosure timeline in the third quarter behind New York, where the averagetime to complete a foreclosure was 1,072 days for properties foreclosed duringthe quarter. Florida registered the third highest state foreclosure timeline,858 days — down slightly from 861 days in the previous quarter — and Illinoisregistered the fourth highest state foreclosure timeline, 673days.
The RealtyTrac U.S. Foreclosure MarketReport provides a count of the total number of properties with at least oneforeclosure filing entered into the RealtyTrac database during the month andquarter — broken out by type of filing. Some foreclosure filings entered intothe database during a month or quarter may have been recorded in previousmonths or quarters. Data is collected from more than 2,200 counties nationwide,and those counties account for more than 90 percent of the U.S. population.RealtyTrac’s report incorporates documents filed in all three phases offoreclosure: Default — Noticeof Default (NOD) and LisPendens (LIS); Auction — Notice of Trustee Saleand Notice of Foreclosure Sale (NTS and NFS); and RealEstate Owned, or REOproperties (that have been foreclosed on and repurchased by a bank).For the quarterly report, if more than one foreclosure document is received fora property during the quarter, only the most recent filing is counted in thereport. Both the quarterly and monthly reports check if the same type ofdocument was filed against a property previously. If so, and if that previousfiling occurred within the estimated foreclosure timeframe for the state wherethe property is located, the report does not count the property again in thecurrent month or quarter.
The RealtyTrac U.S.Foreclosure Market Report is the result of a proprietary evaluation ofinformation compiled by RealtyTrac; the report and any of the information inwhole or in part can only be quoted, copied, published, re-published,distributed and/or re-distributed or used in any manner if the userspecifically references RealtyTrac as the source for said report and/or any ofthe information set forth within thereport.
Detailed and historicalforeclosure data used to create the above report may be purchased through the RealtyTrac Data Licensing Department at 949.502.8300 Ext. 158.Aggregate data is available at the state, metro, county and zip code levelsdating back to 2005, and address-level foreclosure records are also availablehistorically.
RealtyTrac (www.realtytrac.com) is theleading online marketplace of foreclosure properties, with more than 1.5million default, auction and bank-owned listings from over 2,200 U.S. counties,along with detailed property, loan and home sales data. Hosting millions ofunique monthly visitors, RealtyTrac provides innovative technology solutionsand practical education resources to facilitate buying, selling and investingin real estate. RealtyTrac’s foreclosure data has also been used by the FederalReserve, FBI, U.S. Senate Joint Economic Committee and Banking Committee, U.S.Treasury Department, and numerous state housing and banking departments,private companies and academic institutions to help evaluate foreclosure trendsand address policy issues related to foreclosures.
Jennifer von Pohlmann
Historical & DetailedData
Data Sales Department