RealtyTrac released its U.S. Foreclosure Market Report for September and the third quarter of 2013, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 131,232 U.S. properties in September, a two percent increase from the previous month but a 27 percent decrease from a year ago.
September was the 36th consecutive month with an annual decrease in U.S. foreclosure activity, a downward trend that started in October 2010 when lenders and servicers were accused of improperly signing off on foreclosure documents with a practice dubbed robo-signing.
September numbers helped drop third quarter foreclosure activity to the lowest quarterly level since the second quarter of 2007. There were a total of 376,931 U.S. properties with foreclosure filings in the third quarter of 2013, down seven percent from the previous quarter and down 29 percent from the third quarter of 2012 — the biggest annual decrease since the second quarter of 2011. One in every 348 housing units had a foreclosure filing during the quarter.
High-level findings from the report:
►U.S. foreclosure starts in the third quarter were at a seven-year low. A total of 174,366 U.S. properties started the foreclosure process for the first time during the quarter, down 13 percent from the previous quarter and down 39 percent from a year ago to the lowest level since the second quarter of 2006.
►Third quarter foreclosure starts decreased from a year ago in 38 states including Colorado (down 71 percent), Arizona (down 63 percent), California (down 59 percent), Illinois (down 56 percent), and Florida (down 52 percent).
►Third quarter foreclosure starts increased from a year ago in 11 states, including Maryland (up 259 percent), Oregon (up 252 percent), New Jersey (up 53 percent), Connecticut (up 52 percent), Nevada (up 36 percent), and New York (up 25 percent).
►Third quarter bank repossessions (REO) decreased 24 percent from a year ago but were up seven percent from the previous quarter. A total of 119,485 U.S. properties were repossessed by lenders in the third quarter, putting the nation on pace for close to half a million total bank repossessions for the year.
►The quarterly increase in REOs nationwide was driven by quarterly increases in 26 states, including New York (up 65 percent), New Jersey (up 64 percent), Illinois (up 44 percent), Virginia (up 36 percent), Connecticut (up 34 percent), Indiana (up 30 percent), Nevada (up 29 percent), and California (up 19 percent).
►Overall foreclosure activity in September decreased from a year ago in 33 states, but was up from a year ago in 16 states, including Maryland (up 230 percent), Nevada (up 97 percent), Connecticut (up 69 percent), New Jersey (up 55 percent), Pennsylvania (up 34 percent), and New York (up 22 percent).
►September foreclosure activity decreased from a year ago in 144 of the 209 metro areas tracked in the report (69 percent), but increased from a year ago in 64 metros (31 percent), including Baltimore (up 381 percent), Las Vegas (up 109 percent), Raleigh, N.C. (up 97 percent), Hartford, Conn., (up 74 percent), Washington D.C., (up 52 percent), Philadelphia (up 32 percent), and New York (up 25 percent).
“The September and third quarter foreclosure numbers show a housing market that is haltingly returning to health,” said Daren Blomquist, vice president at RealtyTrac. “In a healthy housing market foreclosures are rare but streamlined while still protecting the rights of the homeowner. While foreclosures are clearly becoming fewer and farther between in most markets, the increasing time it takes to foreclose is holding back a more robust and sustainable recovery.
“The sharp jumps in foreclosure activity in some local markets may come as a surprise to some,” Blomquist added. “These spikes in activity demonstrate that while millions of distressed homeowners have been pulled back from the precipice by foreclosure prevention programs over the past several years, once those programs expire or are exhausted, a percentage of these troubled homeowners are still susceptible to falling into foreclosure. In addition even slight economic downturns at the local or regional level can push these homeowners hanging on by a thread over the edge.”
Florida foreclosure activity in the third quarter decreased eight percent from a year ago following six consecutive quarters with annual increases in foreclosure activity, but the state still posted the nation’s highest foreclosure rate during the quarter. A total of 70,902 Florida properties had foreclosure filings in the third quarter, down seven percent from the previous quarter and a rate of one in every 126 housing units — more than twice the national average.
Nevada foreclosure activity in the third quarter increased 10 percent from the previous quarter and was up 21 percent from a year ago. The state’s foreclosure rate ranked second highest in the nation. A total of 9,033 Nevada properties had foreclosure filings in the third quarter, a rate of one in every 128 housing units.
A 180 percent year-over-year increase in foreclosure activity helped boost Maryland’s third quarter foreclosure rate to third highest among the states. A total of 11,617 Maryland properties had foreclosure filings during the quarter, up six percent from the previous quarter and a rate of one in every 204 housing units.
Third quarter foreclosure activity decreased from a year ago in both Illinois and Ohio, but the states still posted the nation’s fourth and fifth highest foreclosure rates respectively. Indiana and South Carolina also ranked among the top 10 state foreclosure rates in the third quarter, at No. 9 and No. 10 respectively, despite annual decreases in foreclosure activity.
Third quarter foreclosure activity increased from a year ago in Connecticut, Delaware and New Jersey, and these states posted the nation’s sixth, seventh and eighth highest state foreclosure rates respectively during the quarter.
With one in every 83 housing units with a foreclosure filing in the third quarter, the Port St. Lucie metro area in southeast Florida posted the nation’s highest foreclosure rate among metropolitan statistical areas with a population of 200,000 or more.
Seven other Florida cities posted foreclosure rates among the 10 highest nationwide in the third quarter: Jacksonville at No. 2 (one in every 96 housing units with a foreclosure filing); Miami at No. 3 (one in every 101 housing units); Palm Bay-Melbourne-Titusville at No. 4 (one in every 102 housing units); Ocala at No. 6 (one in every 120 housing units); Tampa at No. 7 (one in every 120 housing units); Orlando at No. 8 (one in every 134 housing units); and Pensacola at No. 9 (one in every 153 housing units).
Other metro areas with foreclosure rates ranking among the 10 highest were Las Vegas at No. 5 (one in every 109 housing units with a foreclosure filing) and Rockford at No. 10 (one in every 155 housing units).
U.S. properties foreclosed in the third quarter of 2013 were in the foreclosure process an average of 551 days, up five percent from 526 days in the second quarter and up 44 percent from 382 days in the third quarter of 2012.
The average time to foreclose was 1,037 days in New York, the longest of any state, followed by New Jersey (1,014 days), Florida (929 days), Illinois (828 days) and Connecticut (693 days).
The average time to foreclose was 160 days in Maine, the shortest of any state, followed by Texas (164 days), Alabama (185 days), Virginia (189 days) and Delaware (202 days).