U.S. Foreclosures Drop 16 Percent in Second Quarter

A total of 272,109 properties nationwide entered some stage of foreclosure in the second quarter of 2006, a 16 percent decrease from the previous quarter but still a 25 percent year-over-year increase from the second quarter of 2005, according to the RealtyTrac™ 2006 Q2 U.S. Foreclosure Market Report. The nation’s second-quarter foreclosure rate of one new foreclosure for every 425 U.S. households was still higher than in any quarter of last year.

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“Foreclosure filings in the second quarter of 2006 present a classic ‘good news, bad news’ scenario,” said James J. Saccacio, chief executive officer of RealtyTrac. “A 25 percent increase from the second quarter of 2005 obviously isn’t a positive trend. But, despite some of the sensational reports we’ve seen lately, foreclosure filings have actually slowed down since peaking in February.

 

“While the nation’s foreclosure rate has certainly shifted into a higher gear since last year, low unemployment and home price appreciation in most housing markets have held foreclosures in check,” Saccacio continued. “We forecasted a slowdown in foreclosure rates when we released our last quarterly report, and we expect that if the summer months deliver their typically high number of home buyers, the demand for housing created by these buyers should help keep foreclosure rates from rising too rapidly.”

 

Colorado, Georgia and Texas post highest rates
Colorado’s second-quarter foreclosure rate of one new foreclosure filing for every 158 households ranked as the nation’s highest, leapfrogging past Georgia’s foreclosure rate, which was highest in the first quarter. Colorado reported 11,599 properties entering some stage of foreclosure during the second quarter, a 13 percent decrease from the previous quarter but a 48 percent year-over-year increase.

 

Foreclosure activity in Georgia slowed substantially in June, and the state’s second-quarter foreclosure rate — one new foreclosure filing for every 202 households — dropped to second highest among the states. The state reported 15,309 properties entering some stage of foreclosure during the quarter, a 37 percent decrease from the previous quarter but still a 42 percent increase from the second quarter of 2005.

 

Texas reported 39,690 properties entering some stage of foreclosure during the second quarter, the most of any state and a foreclosure rate of one new foreclosure for every 203 households — the nation’s third highest state foreclosure rate. The state’s foreclosure activity decreased 1 percent from the previous quarter but was up 22 percent from the second quarter of 2005.

 

Other states with second-quarter foreclosure rates ranking among the nation’s 10 highest included Utah, Indiana, Nevada, Illinois, Michigan, Florida and Ohio.

 

California and Florida foreclosure numbers down
After Texas, California and Florida documented the second and third most foreclosure filings of any state despite declining foreclosure activity in the second quarter. California reported 27,606 properties entering some stage of foreclosure, a 7 percent decrease from the previous quarter but more than twice the number reported in the second quarter of 2005. Florida reported 25,853 properties entering some stage of foreclosure, a 13 percent decrease from the previous quarter and a 16 percent year-over-year decrease.

 

With 18,690 properties entering some stage of foreclosure, Illinois reported the fourth highest number of new foreclosure filings in the second quarter. The state’s foreclosure activity increased 37 percent from the previous quarter and 57 percent from the second quarter of 2005.

 

“One of the key factors to watch for over the next quarter is the extent to which some of the higher-risk, adjustable rate mortgages go into default,” Saccacio said. “Hundreds of millions of dollars of these types of loans are due to re-set during the rest of 2006, and if they default at a higher rate than more traditional mortgage loans, it could significantly accelerate foreclosure filings.”

 

The RealtyTrac 2006 Q2 U.S. Foreclosure Market Report provides the total number of homes entering some stage of foreclosure nationwide and by state in the second quarter of 2006. RealtyTrac’s report includes properties in all three phases of foreclosure: Pre-foreclosures – Notice of Default (NOD) and Lis Pendens (LIS); Foreclosures – Notice of Trustee Sale and Notice of Foreclosure Sale (NTS and NFS); and Real Estate Owned, or REO properties (that have been re-purchased by a bank).  

 

U.S. Foreclosure Market Statistics by State – Q2 2006

 

 

State Name

April 2006

May 2006

June 2006

Total

 

1/every #HH

% Change from Q1 2006

% Change from Q2 2005

US

91,168

92,746

88,195

272,109

425

-15.78

24.73

Alabama

261

366

287

914

2,148

155.31

-50.46

Alaska

84

86

49

219

937

-19.78

-47.86

Arizona

1,701

1,986

2,131

5,818

376

-6.64

-23.21

Arkansas

764

784

835

2,383

492

-35.70

-20.51

California

8,839

8,736

10,031

27,606

442

-6.54

104.43

Colorado

3,706

4,198

3,695

11,599

158

-12.57

47.53

Connecticut*

1,408

689

1,062

3,159

439

26.21

21.45

Delaware

17

9

80

106

3,237

32.50

-6.19

District of Columbia

13

9

11

33

8,329

22.22

-47.62

Florida

8,350

8,898

8,605

25,853

283

-12.76

-16.09

Georgia

5,150

5,769

4,390

15,309

202

-37.31

41.86

Hawaii

46

131

22

199

2,314

48.51

-5.69

Idaho

190

193

145

528

996

-30.53

-22.81

Illinois

6,451

6,359

5,880

18,690

262

36.51

57.14

Indiana

4,309

3,494

2,972

10,775

234

-29.40

49.47

Iowa

184

175

167

526

2,343

-46.22

16.63

Kansas*

436

407

377

1,220

925

103.33

134.62

Kentucky

599

518

358

1,475

1,187

3.65

-16.10

Louisiana

81

158

136

375

5,022

9.97

-72.51

Maine

13

6

5

24

27,162

-44.19

-17.24

Maryland*

427

260

466

1,153

1,858

6.66

7.96

Massachusetts*

575

586

1,174

2,335

1,123

140.23

100.43

Michigan

5,269

5,066

4,853

15,188

278

-33.22

110.30

Minnesota*

457

355

543

1,355

1,526

19.81

137.30

Mississippi

44

56

54

154

8,239

-35.02

-81.88

Missouri*

999

1,423

950

3,372

723

-32.75

18.07

Montana

75

65

58

198

2,081

-37.54

10.61

Nebraska

115

150

103

368

1,953

-50.27

21.45

Nevada

1,152

1,103

1,244

3,499

248

-30.53

94.61

New Hampshire

12

13

9

34

16,089

30.77

17.24

New Jersey

1,935

1,945

2,865

6,745

491

-35.52

-26.40

New Mexico

703

536

537

1,776

440

-3.27

-13.83

New York

4,216

4,610

3,907

12,733

603

-7.70

28.14

North Carolina

1,847

1,672

1,343

4,862

724

-36.56

15.93

North Dakota

5

20

9

34

8,520

-47.69

-35.85

Ohio

4,860

5,239

5,942

16,041

298

-29.83

62.01

Oklahoma

1,156

1,413

1,100

3,669

407

-22.38

3.56

Oregon

912

1,659

1,381

3,952

368

95.16

123.15

Pennsylvania

2,428

2,295

2,809

7,532

697

-38.54

-3.77

Rhode Island*

111

101

115

327

1,345

3533.33

1716.67

South Carolina

684

539

607

1,830

958

-28.29

-11.98

South Dakota

32

23

16

71

4,552

-6.58

44.90

Tennessee

2,613

2,442

2,404

7,459

329

-36.35

1.76

Texas

13,829

14,506

11,355

39,690

203

-1.36

22.19

Utah

1,418

1,112

957

3,487

220

-2.02

26.85

Vermont

3

4

8

15

19,625

-28.57

-6.25

Virginia*

294

346

230

870

3,318

-16.18

61.71

Washington

1,638

1,511

1,440

4,589

521

-15.00

4.89

West Virginia

50

71

76

197

4,287

-13.97

-2.48

Wisconsin

689

632

355

1,676

1,374

-14.10

61.78

Wyoming

18

22

46

86

2,603

40.98

72.00

 

*RealtyTrac implemented new or improved data acquisition methods in this state during Q2 2006, meaning the actual rate of change may be different than what our data indicates.

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