RealtyTrac: Midyear Foreclosures Are Down 11%

RealtyTrac has released its Midyear 2016 U.S. Foreclosure Market Report, which shows a total of 533,813 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions — in the first six months of 2016, down 20 percent from the previous six months and down 11 percent from the first six months of 2015.

Counter to the national trend, 19 states posted year-over-year increases in foreclosure activity in the first half of 2016, including Massachusetts (up 46 percent); Connecticut (up 40 percent); Virginia (up 18 percent); Alabama (up 11 percent); and New York (up 10 percent).

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Among the nation’s 20 most-populated metro areas, five posted year-over-year increases in foreclosure activity: Boston (up 38 percent); Philadelphia (up 7 percent); New York (up 4 percent); Washington, D.C. (up 3 percent); and Baltimore (up 1 percent).

“Although there are some local outliers, the downward foreclosure trend continued in the first half of 2016 in most markets nationwide,” said Daren Blomquist, senior vice president at RealtyTrac. “While U.S. foreclosure activity is still above its pre-recession levels, many of the states hit hardest by the housing crisis have now dropped below pre-recession foreclosure activity levels. With some exceptions, states with foreclosure activity continuing to run above pre-recession levels tend to be those with protracted foreclosure timelines still working through legacy distress from the last housing bust.”

Q2 2016 foreclosure activity below pre-recession average in 15 states

There were a total of 280,989 U.S. properties with foreclosure filings in Q2 2016, down 3 percent from the previous quarter and down 18 percent from a year ago to the lowest level since Q4 2006.

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Nationwide foreclosure activity in Q2 2016 was still 21 percent above the pre-recession average of 232,082 properties with foreclosure filings per quarter in 2005, 2006 and 2007, but Q2 2016 foreclosure activity was below pre-recession averages in 15 states, including Arizona (13 percent below pre-recession averages); California (25 percent below); Colorado (72 percent below); Georgia (33 percent below); Michigan (46 percent below); Nevada (18 percent below); Ohio (9 percent below); and Texas (46 percent below).

States where Q2 2016 foreclosure activity was still above pre-recession averages included Florida (26 percent above pre-recession levels); New Jersey (215 percent above); Illinois (36 percent above); New York (127 percent above); Indiana (2 percent above); South Carolina (376 percent above); Massachusetts (127 percent above); and Washington (29 percent above).

“It is pleasing to note the 30 percent drop in foreclosure filings in the Central Puget Sound region versus the prior six-month period and the number down by over 10 percent from the same period a year ago,” said Matthew Gardner, chief economist at Windermere Real Estate, covering the Seattle market. “There is no reason to believe that we will see any increase in the level of foreclosure activity in the foreseeable future.  In fact, I would contend that we will see the number of foreclosures continue to contract as job growth — and home price growth — continue to outperform the nation as a whole.”

“South Florida saw a 34 percent drop in foreclosure filings year-over-year,” said Mike Pappas, president and CEO at Keyes Company, covering the South Florida market. “With strong employment, low interest rates, and with lenders continuing to carefully scrutinize borrowers — foreclosures will soon be at the lowest levels in a decade.”

June foreclosure activity drops to nearly 10-year low

There were a total of 94,469 U.S. properties with a foreclosure filing in June, down 6 percent from the previous month and down 19 percent from a year ago to the lowest level since July 2006 — a nearly 10-year low.