Foreclosure Starts Increase 4 Percent From Previous Month, 26 States Post Increases
Florida, Nevada, Ohio, Maryland, South Carolina With Top 5 State Foreclosure Rates
IRVINE, Calif. – June 13, 2013 — RealtyTrac® (www.realtytrac.com), the leading online marketplace for real estate data, today released its U.S. Foreclosure Market Report™ for May 2013, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 148,054 U.S. properties in May, an increase of 2 percent from the 75-month low in April but still down 28 percent from May 2012. The report also shows one in every 885 U.S. housing units with a foreclosure filing during the month.
High-level findings from the report:
- The monthly increase in overall foreclosure activity was caused largely by an 11 percent month-over-month increase in bank repossessions (REOs), although REO activity was still down 29 percent from a year ago.
- REO activity increased from the previous month in 33 states — including North Carolina (up 60 percent), Oregon (up 57 percent), Wisconsin (up 44 percent), Illinois (up 44 percent), Colorado (up 23 percent), and Michigan (up 19 percent). REO activity increased 9 percent from the previous month in non-judicial states and was up 13 percent from the previous month in judicial states.
- Among the five lenders involved in last year’s national mortgage settlement, all but one (Citi) posted monthly increases in REO activity, indicating that temporary stoppages of foreclosure sales announced during the month by some of the lenders involved in the settlement had little lasting impact on the number of completed foreclosures for the month.
- U.S. foreclosure starts increased 4 percent from the previous month but were still down 33 percent from a year ago. Foreclosure starts increased from the previous month in 26 states and were up from a year ago in 14 states, including Maryland (up 229 percent), Connecticut (up 122 percent), Hawaii (up 108 percent), Arkansas (up 84 percent), New Jersey (up 82 percent), Nevada (up 81 percent), Washington (up 53 percent), Pennsylvania (up 26 percent) and New York (up 13 percent).
- The foreclosure problem continued to shift away from non-judicial states and toward judicial states. Judicial states accounted for five of the top six foreclosure rates nationwide: Florida, Ohio, Maryland, South Carolina and Illinois. At No. 2, Nevada’s foreclosure rate was the highest ranked among non-judicial states.
- Among the nation’s 20 largest metros, those with the biggest increases in median home prices tended to be in states where a non-judicial foreclosure process has allowed foreclosures to be absorbed by the market more quickly. Seven of the 10 metros with the biggest jumps in median home prices from a year ago were in non-judicial states, while all five metros with flat or declining median prices were in states with a judicial foreclosure process.
“Foreclosure activity continued to bounce back in some markets where it may have appeared the foreclosure problem had been knocked out by an aggressive combination of foreclosure prevention efforts over the past two years,” said Daren Blomquist, vice president at RealtyTrac. “Places like Nevada, where foreclosure starts increased to a 20-month high, and Maryland, where overall foreclosure activity increased to a 33-month high. Still, the emerging housing recovery has strengthened most local markets enough to quickly shake off a few more blows from these nagging foreclosures.”
Local broker quotes from the RealtyTrac Network
- “While foreclosure activity is less than one-third the level it was at the height of the foreclosure crisis in Reno, the 20-month high in foreclosure starts in May could provide some limited relief to the shortage of inventory as those foreclosure starts translate into short sales, sales at the public foreclosure auction or possibly bank-owned sales over the next year,” said Craig King, COO at Chase International brokerage, which covers the Reno and Lake Tahoe markets. “Given the shortage of inventory and rising home prices, banks have little motivation to hold back on any foreclosures, so homeowners who have not been making payments for several months or even years without a foreclosure notice should expect to see that notice coming and would be well-advised to list their home as a short sale if they have no other alternative to avoid foreclosure.”
- “Southern California is seeing the lowest levels of distress since 2005,” said Rich Cosner, CEO of Prudential California Realty, covering Orange, Riverside and San Bernardino counties. “Given that 2005 was one of the best real estate markets in history, what we may be seeing is that the foreclosure levels and NOD levels are bottoming out at their historical lows. Those few foreclosures selling at the courthouse steps are being bought at almost market-level prices and are being paid for in cash by investors.”
Florida, Nevada, Ohio post top state foreclosure rates
A 20 percent monthly increase in foreclosure activity pushed Florida’s foreclosure rate to highest among the states in May, up from the No. 2 ranking in April. One in every 302 Florida housing units had a foreclosure filing during the month, nearly three times the national average. Florida foreclosure starts jumped 39 percent from a two-year low in April, but were still down 17 percent from a year ago. Scheduled foreclosure auctions in Florida increased 6 percent from the previous month and were up 79 percent from a year ago, while Florida bank repossessions increased 14 percent from the previous month and were up 20 percent from a year ago.
Nevada foreclosure activity increased annually in May after 27 consecutive months of annual decreases, but the state’s foreclosure rate still slipped to second highest among the states after ranking No. 1 in April. One in every 305 Nevada housing units had a foreclosure filing during the month. The increase in overall foreclosure activity in Nevada was driven primarily by an 81 percent year-over-year increase in foreclosure starts, which reached a 20-month high in May. Meanwhile scheduled foreclosure auctions in Nevada increased 21 percent from the previous month but were still down 14 percent from a year ago, and bank repossessions increased 4 percent from the previous month but were still down 64 percent from a year ago.
Ohio posted the nation’s third highest state foreclosure rate for the second month in a row in May, with one in every 584 housing units with a foreclosure filing during the month. A total of 8,770 Ohio properties had a foreclosure filing during the month, down 27 percent from a 31-month high in April and down 15 percent from May 2012. Ohio foreclosure starts and scheduled foreclosure auctions both decreased in May, but bank repossessions were still up 7 percent from a year ago — the ninth consecutive month with an annual increase in bank repossessions.
Maryland foreclosure activity increased 11 percent from the previous month and was up 134 percent from a year ago, and the state posted the nation’s fourth highest foreclosure rate in May: one in every 587 housing units with a foreclosure filing.
South Carolina foreclosure activity decreased 2 percent from the previous month and was down 11 percent from a year ago, but the state still posted the nation’s fifth highest state foreclosure rate in May: one in every 600 housing units with a foreclosure filing.
Other states with foreclosure rates ranking among the 10 highest nationwide were Illinois (one in every 606 housing units with a foreclosure filing), Georgia (one in 693 housing units), Washington (one in 736 housing units), Arizona (one in 742 housing units), and Wisconsin (one in 774 housing units).
Top metro foreclosure rates in Florida, Nevada, Pennsylvania and Illinois cities
With one in every 209 housing units with a foreclosure filing, Miami posted the nation’s highest foreclosure rate in May among metropolitan statistical areas with a population of 200,000 or more. Foreclosure activity in the Miami metro area increased 29 percent from the previous month and was up 59 percent from a year ago.
Five other Florida metro areas posted foreclosure rates that ranked among the top 10 in May: Jacksonville at No. 2 (one in every 225 housing units with a foreclosure filing); Tampa at No. 3 (one in every 290 housing units); Orlando at No. 7 (one in every 336 housing units); Ocala at No. 9 (one in every 352 housing units); and Sarasota at No. 10 (one in every 360 housing units).
Other metro areas with foreclosure rates ranking in the top 10 were Las Vegas at No. 4 (one in every 296 housing units); Reno, Nev., at No. 5 (one in every 301 housing units); Reading, Pa., at No. 6 (one in every 306 housing units); and Rockford, Ill., at No. 8 (one in every 347 housing units).
20 major metro foreclosure and home price trends
Among 20 of the nation’s largest metros, those with the biggest increases in median home prices tended to be in states where a non-judicial foreclosure process has allowed foreclosures to be absorbed by the market more quickly. Seven of the 10 metros with the biggest jumps in median home prices from a year ago were in non-judicial states, and foreclosure activity in all seven of these metros was down by 25 percent (Denver) to 64 percent (Phoenix) from a year ago.
Meanwhile all five metros with flat or declining median prices were in states with a judicial foreclosure process, and in all but one of these metros (Boston) foreclosure activity increased in May from a year ago.
The RealtyTrac U.S. Foreclosure Market Report provides a count of the total number of properties with at least one foreclosure filing entered into the RealtyTrac database during the month — broken out by type of filing. Some foreclosure filings entered into the database during the month may have been recorded in previous months. 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 of foreclosure: Default — Notice of Default (NOD) and Lis Pendens (LIS); Auction — Notice of Trustee’s Sale and Notice of Foreclosure Sale (NTS and NFS); and Real Estate Owned, or REO properties (that have been foreclosed on and repurchased by a bank). The report does not count a property again if it receives the same type of foreclosure filing multiple times within the estimated foreclosure timeframe for the state where the property is located.
The RealtyTrac U.S. Foreclosure Market Report is the result of a proprietary evaluation of information compiled by RealtyTrac; the report and any of the information in whole or in part can only be quoted, copied, published, re-published, distributed and/or re-distributed or used in any manner if the user specifically references RealtyTrac as the source for said report and/or any of the information set forth within the report.
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RealtyTrac (www.realtytrac.com) is the leading supplier of U.S. real estate data, with more than 1.5 million active default, foreclosure auction and bank-owned properties, and more than 1 million active for-sale listings on its website, which also provides essential housing information for more than 100 million homes nationwide. This information includes property characteristics, tax assessor records, bankruptcy status and sales history, along with 20 categories of key housing-related facts provided by RealtyTrac’s wholly-owned subsidiary, Homefacts®. RealtyTrac’s foreclosure reports and other housing data are relied on by the Federal Reserve, U.S. Treasury Department, HUD, numerous state housing and banking departments, investment funds as well as millions of real estate professionals and consumers, to help evaluate housing trends and make informed decisions about real estate.
Jennifer von Pohlmann
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