spiking 8 percent in January, foreclosures filings have resumed their downward
spiral RealtyTrac said today. Its U.S.
Foreclosure Market Report for February notes that filings, including default
notices, scheduled auctions, and bank repossessions or completed foreclosures,
decreased by 10 percent from January and were 27 percent below levels one year
earlier. There were a total of 112,498
filings during the month, the lowest monthly total since December 2006.
starts, which increased 10 percent in January retreated 9 percent in February
to a total of 51,842, a 98 month low and 27 percent lower than in February
2013. Foreclosure auctions were
scheduled for the first time on 47,715 properties, down 15 percent from the
previous month and 21 percent from a year earlier. Bank repossessions (REO) rose less than 1
percent from January to 30,307 but this was 33 percent below the completed foreclosures
in February 2013.
There were states that ran counter
to each of the national trends but it was not necessarily the same states seeing
increases in all categories. Nineteen
states had higher numbers of scheduled auctions than a year earlier with Oregon
jumping 389 percent and Utah and Connecticut each up over 140 percent. Connecticut was among the 15 states
with an increase in REO as well, jumping 162 percent, along with New York (108
percent), Maryland (98 percent), and New Jersey (90 percent). New Jersey also had the largest increase in
foreclosure starts with 126 percent more in February 2014 than in February
States with the highest foreclosure
rates in February were Florida, Maryland, and Nevada. But while Florida and
Nevada remain on a downward trajectory, Maryland continues to increase. It is now in second place nationally with a
filing for one in every 557 housing units after activity increased in February
for the 20th consecutive month.
On a year-over-year basis, Maryland foreclosure starts increased 15
percent, scheduled foreclosure auctions increased 36 percent, and bank
repossessions increased 98 percent.
Florida remains the most active
state for foreclosure filings with one in every 372 households affected. However, February marked the 12th
consecutive monthly drop in foreclosure starts and the sixth for decreases in
bank repossessions. Scheduled auctions
decreased 2 percent on an annual basis in February after increasing for 13
Nevada's activity also continued to
fall, decreasing 16 percent month over month and 49 percent from the previous
year. The state still posted the nation's
third highest foreclosure rate - one in every 633 housing units with a
Other states in the top five for
foreclosure activity were New Jersey and Illinois. New
Jersey had a filing on one in every 739 housing units, Illinois on one in 811.
Nine of the top 10 metro foreclosure
rates in February were posted by cities in Florida, along with Atlantic City,
N.J., where overall foreclosure activity increased 254 percent from a year ago.
The RealtyTrac report also included
updated information on what it calls zombie foreclosures, properties that were
left vacant by the distressed homeowners.
The company estimated that 152,033 properties, 21 percent of all
properties in foreclosure, had been abandoned as of the first quarter of
2014. This does not include vacant
bank-owned properties. The properties
had been in the foreclosure process an average of 1,031 days.
The number of zombie foreclosures
nationwide did not change substantially from RealtyTrac's report in the third
quarter of 2013, but some states saw substantial increases in owner-vacated
properties. They increased 27 percent in
Michigan, 14 percent in New Jersey, and 21 percent in Nevada. The largest number of such abandoned
properties were in Florida, which houses almost 55,000 of them, Illinois, New
York, and New Jersey. States with the
longest average time in foreclosure for owner-vacated foreclosures included
Arkansas (1,128 days), Hawaii (1,112 days), Florida (1,095 days), Nevada (1,055
days), and New York (1,037 days).
"Cold weather and a short
month certainly contributed to a seasonal drop in foreclosure activity in
February, but the reality is that new activity is no longer the biggest threat
to the housing market when it comes to foreclosures," said Daren Blomquist,
vice president at RealtyTrac. "The biggest threat from foreclosures going
forward is properties that have been lingering in the foreclosure process for
years, many of them vacant with neither the distressed homeowner or the
foreclosing lender taking responsibility for maintenance and upkeep of the home
- or at the very least facilitating a sale to a new homeowner more likely to
perform needed upkeep and maintenance.
"One in every five homes in
the foreclosure process nationwide have been vacated by the distressed
homeowner, but it is closer to one in three foreclosures in some cities,"
Blomquist added. "These properties drag down home values in the surrounding
neighborhood and contribute to a climate of uncertainty and low inventory in
local housing markets."