Foreclosures Decline in January. Expecting Evictions to Increase in Months Ahead
Whatrnappears at first glance to be some good news on the foreclosure front may merelyrnindicate a lull that is preceding new surge of activity.
RealtyTrac, the Irvine California company thatrntracks such matters, reports that there was a 10 percent decline in foreclosurernactivity during January compared to the previous month. However, the rate at which default notices,rnscheduled auctions, and bank repossessions were reported during the month wasrnstill 15 percent above the level one year earlier. (MND comment: It is worth noting that allrnforeclosure activity on behalf of Freddie Mac and Fannie Mae was suspended fromrnNovember 26, 2008 until January 9, 2009.)
James J.rnSaccacio, chief executive officer of RealtyTrac said “January foreclosure numbersrnare exhibiting a pattern very similar to a year ago: a double-digitrnpercentage jump in December foreclosure activity followed by a 10 percentrndrop in January. If history repeats itself we will see a surge in the numbersrnover the next few months as lenders foreclose on delinquent loans wherernneither the existing loan modification programs or the new short sale andrndeed-in-lieu of foreclosure alternatives works.”
RealtyTracrnbases its foreclosure estimates on the number of default notices, scheduledrnauctions, and bank repossessions filed during the month. 317,716 properties were the subject of suchrnfilings during January; this is one in every 409 U.S. housing units.
All ofrnthe filings covered showed the same pattern of falling off of December figuresrnbut tracking higher for the year. Real estate owned (REO) activity was down 5rnpercent from December but up 31 percent from January 2009; default notices werern12 percent lower than the month before and 4 percent higher for the year; auctionsrnwere down 11 percent from December but 15 percent higher than in Januaryrn2009.
Evenrnthough foreclosure activity declined 18 percent from a year earlier, Nevadarnstill had the highest foreclosure rate in the country for the 37thconsecutive month. One in every 95rnhouses in the state had some type of a filing recorded during January. This is four times the national average.
Arizona'srnforeclosure activity was up 4.5 percent from December filings and a staggeringrn44.5 percent year over year with one in every 129 homes in Arizona affected.
Californiarnand Florida both saw big drops in foreclosure activity during the month andrnregistered nearly identical activity rates with one in every 187 housesrnreceiving a filing in each of the two states. Activity in California dropped 11rnpercent from December to January and was also down 6.5 percent from January tornJanuary while Florida was down 15 percent month over month but up 15.5 percentrnfor the year.
Utah isrnthe final state ranking in the top five with one in every 231 housing unitsrnreceiving a foreclosure notice. Still,rnthis was a decrease of almost 12 percent compared to December.
In termsrnof actual rather than relative numbers of homes receiving filings, California,rnFlorida, Arizona, Illinois, Michigan, and Texas together accounted for 60rnpercent of all foreclosure activity reported. The first three states on thernlist represented 44 percent of the national total.
PhoenixrnArizona was the only metropolitan area posting an increase in foreclosurernactivity in January, up 4 percent to one of every 102 housing units. Las Vegas had the highest rate among citiesrnwith one in every 82 units affected, but this was 21 percent lower thanrnactivity reported one year ago.
HERE are MNDs thoughts on Shadow Inventory
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