Two of the major players in real estate data and analytics updated their statistics on the more recent foreclosure data, which shows the continuing trend of a slowdown in the market.
RealtyTrac released its U.S. Foreclosure Market Report for February 2012, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 206,900 U.S. properties in February. That was a 2 percent decrease from the previous month and was down 8 percent from February 2011. That represents the lowest annual decrease since October 2010. The report also shows one in every 637 U.S. housing units with a foreclosure filing during the month.
But despite the decreases, RealtyTrac is still reading between the lines and seeing a new foreclosure wave on the way.
“February’s numbers point to a gradually rising foreclosure tide as some of the barriers that have been holding back foreclosures are removed,” said Brandon Moore, chief executive officer of RealtyTrac. “Although national foreclosure activity was pushed lower by decreases in a handful of larger states, 21 states posted annual increases in foreclosure activity, the most states with annual increases since November 2010.
“The foreclosure and mortgage settlement filed in court earlier this week will help pave the way to a properly functioning foreclosure process by providing a clear roadmap for necessary foreclosures,” Moore continued. “That should result in more states posting annual increases in the coming months. Not surprisingly, many of the biggest annual increases in February were in states with the more bureaucratic judicial foreclosure process, which resulted in a larger backlog of foreclosures built up over the last 18 months in those states.”
February foreclosure activity in the 26 states with a judicial foreclosure process increased 2 percent from January and was up 24 percent from February 2011, while activity in the 24 states with a non-judicial foreclosure process decreased 5 percent from January and was down 23 percent from February 2011.
Ten of the nation’s 20 largest metro areas by population documented year-over-year increases in foreclosure activity in February, led by the Florida cities of Tampa (64 percent increase) and Miami (53 percent increase). The 10 metro areas with increases were all on the East Coast or in the Midwest, while most of the metro areas with year-over-year decreases in foreclosure activity were in the West, led by Seattle (59 percent decrease) and Phoenix (43 percent decrease).
At the same time, CoreLogic released its National Foreclosure Report for January, which provides monthly data on completed foreclosures, foreclosure inventory and 90-plus delinquency rates. There were 69,000 completed foreclosures in January 2012, compared to 80,000 in January 2011, and 65,000 in December 2011. The number of completed foreclosures for the previous 12 months was 860,128. From the start of the financial crisis in September 2008, there have been approximately 3.3 million completed foreclosures.
CoreLogic has a more hopeful outlook for the market going forward.
“We are encouraged by the noticeable progress we are seeing over the last several months in the mortgage industry,” said Anand Nallathambi, chief executive officer of CoreLogic. “During the last several years the industry has faced enormous challenges working through difficult and complex issues. We are hopeful that these recent improvements are early signals of revitalization in the mortgage market.”
Approximately 1.4 million homes, or 3.3 percent of all homes with a mortgage, were in the foreclosure inventory as of January 2012 compared to 1.5 million, or 3.6 percent, in January 2011 and 1.4 million, or 3.4 percent, in December 2011. Nationally, the number of loans in the foreclosure inventory decreased by 145,000, or 9.5 percent in January 2012 compared to January 2011.
The share of borrowers nationally that were more than 90 days late on their mortgage payment, including homes in foreclosure and REO, fell to 7.2 percent in January 2012 from 7.8 percent in January 2011, but remained unchanged from December 2011.
The inventory of REO assets held by servicers nationwide grew faster in January than the pace of REO sales, as measured by the distressed clearing ratio. The distressed clearing ratio is calculated by dividing the number of REO sales by the number of completed foreclosures; the higher the ratio, the faster the pace of REO sales relative to the pace of completed foreclosures. The distressed clearing ratio for January 2012 was 0.69, down from 0.80 in December 2011.
“The pace of completed foreclosures is gradually increasing again, but the clearing ratio is falling as REO sales have slowed in the winter months. Judicial foreclosure states are continuing to process foreclosures more slowly than non-judicial foreclosure states,” said Mark Fleming, chief economist with CoreLogic. “Non-judicial foreclosure states completed almost twice as many foreclosures per 1000 active loans as judicial foreclosure states in January.”