Overall Foreclosure Activity at Lowest Level Since January 2007
New State Laws Passed in June Contributing to Slowdown
IRVINE, Calif. – August 15, 2013 — RealtyTrac® (www.realtytrac.com), the leading online marketplace for comprehensive housing and real estate data, today released a July 2013 Foreclosure Market Report™ for the Reno-Sparks metropolitan statistical area, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 110 properties in July in the metro area, a decrease of 33 percent from June 2013 and down 69 percent from July 2012.
The decrease in Reno-Sparks overall foreclosure activity was driven by a sharp drop in Notices of Default (NOD) and scheduled foreclosure auctions (NTS). Notices of Default dropped 46 percent from June to July, with only13 NODs in the metro area during the month — down 93 percent from July 2012. July was the second straight month where NODs decreased annually following six straight months where NODs were rebounding annually.
“New state legislation has slowed down the foreclosure process in Nevada once again,” said Craig King, chief operating officer of Reno-based real estate brokerage Chase International. “Attorneys, Realtors, buyers, lenders, title companies and others are sorting through the new laws, which could take some time to decipher.
“We’re well past the worst of the foreclosure crisis in Reno, but the rapidly changing laws are making it more difficult to clear out the distressed properties that are still hanging around,” King continued. “The irony is that now would be a great time to sell those distressed properties given the low inventory of homes for sale now available.”
King said the decrease in July foreclosure activity was largely due to the changes made to the foreclosure process by two conflicting pieces of legislation recently passed by the state legislature and signed into law by the governor. One piece of legislation, Assembly Bill 300, was written to ease up some of the requirements put on foreclosing lenders by another state law passed back in October 2011, AB 284. AB 300 modified the strict documentation standards of AB 284 by clarifying the language and changing documentation requirements.
The other piece of legislation SB 321 — known as the “Homeowner Bill of Rights — makes it more difficult for banks to foreclose in Nevada and will go into effect Oct. 1. This legislation outlaws the practice of dual-tracking — where a lender simultaneously pursues foreclosure and a foreclosure alternative such as loan modification — and requires lenders to provide homeowners facing foreclosure with a single point of contact. In addition, SB 321 requires lenders to send homeowners facing foreclosure a notice with information about foreclosure alternatives at least 30 days before filing a Notice of Default.
He added that the market still has several years to clear out the huge number of Nevada mortgages that are underwater, where borrowers owe more on the mortgage than the property is worth. He said strong demand and a decline in inventory combined to create double-digit price appreciation in the Northern Nevada.
“Clearly, the Reno-Sparks housing market is improving,” added King. “Sales prices are up, land values are rising and new home construction is growing. I’m very optimistic about the local residential real estate market.”
Falling foreclosure activity in July pushed the foreclosure rate in the Reno-Sparks metro area below the national average and to the 141st ranking out of the 209 metro areas with a population of 200,000 or more. One in every 1,686 Reno-Sparks housing units had a foreclosure filing in July, compared to the national average of one in 1,001 housing units.
Nevada’s housing market is on a rebound, said King. Statewide foreclosure activity declined 44 percent year-over-year in July, with one in every 731 housing units receiving a foreclosure notice. The state ranked seventh highest nationwide in foreclosure rate.
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.
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