Completed Foreclosures Down 31% from Year Ago, but Remain High
By: Esther Cho
Completed foreclosures continued their descent into September, falling 31 percent from a year ago, according to data from CoreLogic.
The analytics company reported the number of homes lost to foreclosure in September dropped to 57,000. The decline is a steep drop from 83,000 in September 2011, and a decrease from the upwardly revised 59,000 in August.
In addition to the monthly and yearly declines, Mark Fleming, chief economist for CoreLogic, said completed foreclosures are also down 50 percent since the peak month in September 2010 and are 22 percent less than the beginning of the year.
Before the housing crises, completed foreclosures were much lower than the sinking figures reported recently. Between 2000 and 2006, completed foreclosures averaged 21,000 per month.
“While there is significant progress to be made before returning to pre-crisis levels, the trend is in the right direction as short sales, up 27 percent year over year in August, continue to gain popularity,” said Fleming.
Since the start of the financial crisis in September 2008, about 3.9 million homes have been lost to foreclosure in the United States.
Foreclosure inventory is also depleting, with the number of homes in foreclosure inventory falling to 1.4 million, or 3.3 percent of all homes with a mortgage, in September. Mortgaged homes in any stage of the foreclosure process are counted as foreclosure inventory.
A year ago, approximately 1.5 million homes, or 3.5 percent of homes with a mortgage, were in foreclosure inventory. The month-over-month drop in foreclosure inventory was 1.1 percent.
“The continuing downward trend in foreclosures along with a gradual clearing of the shadow inventory are signs of stabilization and improvement in the housing market,” said Anand Nallathambi, president and CEO of CoreLogic. “Increasingly improving market conditions and industry and government policy are allowing distressed homeowners to pursue refinancing, loan modifications or short sales rather than foreclosures.”
California had the highest number of completed foreclosures, 108,000, over a one year period. The state was followed by Florida (92,000), Texas (59,000), Georgia (55,000) and Michigan (51,000). The five states alone accounted for 47.7 percent of all completed foreclosures.
South Dakota had the lowest number of completed foreclosures at 20, with the District of Columbia ranking second with 58 foreclosures. Hawaii trailed far behind at third with 436 foreclosures, followed by North Dakota (583) and Maine (625).
The five states that led for having the highest share of inventory in foreclosure were Florida (11.5 percent), New Jersey (7.3 percent), New York (5.3 percent), Illinois (5.2 percent), and Nevada (4.9 percent). Out of all five states, Nevada is the only one with a non-judicial process.
Four states had less than once percent of inventory in foreclosure: Wyoming (0.5 percent), Alaska (0.7 percent), North Dakota (0.7 percent), and Nebraska (0.9 percent).
Among the metros, Atlanta’s 36,521 completed foreclosures in a 12-month period put it in the lead for September. Phoenix (31,129) ranked second and Riverside (21,691) took the third spot.
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