While completed foreclosures increased
slightly from May to June, the foreclosure inventory, a count of homes in the
process of foreclosure, continued to slide.
CoreLogic's National Foreclosure Report for June puts the number of
homes lost to foreclosure during the month at 49,000 units. While this was an increase of 2.7 percent
compared to May's 48,000 completed foreclosures, it was down 9.9 percent from
the 54,000 foreclosures in June 2013.
Even at the declining rate, completed
foreclosures are still running at better than twice what is historically considered
normal. CoreLogic points out as a basis
of comparison that in the six years before the 2007 decline in the housing
market, completed foreclosures averaged 21,000 per month. Since the foreclosure
crisis began in earnest in September 2008 there have been approximately 5.1
million foreclosures completed.
The foreclosure inventory stood at
648,000 homes at the end of June compared to 1 million a year earlier, a
year-over-year drop of 35 percent and down 3.9 percent from May. It was the 32nd month of consecutive annual
declines and the 17th month in which those declines have been in
excess of 20 percent. The foreclosure
inventory rate, the percentage of all mortgaged homes in foreclosure, has
dropped from 2.5 percent in June 2013 to 1.7 percent.
"While 32 straight months of year-over-year decline in the
foreclosure rate is cause for celebration, the total number of homes still in
the foreclosure process remains almost four times as high as the average in the
early 2000s," said Mark Fleming, chief economist for CoreLogic. "Additionally,
there is concern over whether or not we can maintain this pace of improvement
as the foreclosure inventory becomes more concentrated in judicial states
with lengthier, more complex processes and timelines."
All but one state had double digits drops in completed foreclosures
year-over-year. Wyoming saw a 5.1
increase in its completed foreclosures but this still resulted in only 767
actions. Five states, Florida, Michigan,
Texas, California, and Georgia together accounted for nearly half of all
completed foreclosures in the nation in June.
Thirty-six states had annual
declines in their foreclosure inventory greater than 30 percent and Arizona and
Utah's inventories dropped more than 50 percent. The five states
with the highest foreclosure inventory as a percentage of all mortgaged homes
were: New Jersey (5.7 percent), Florida (5.0 percent), New York (4.3 percent),
Hawaii (3.1 percent) and Maine (2.7 percent).
All are judicial process states.
"The national inventory of foreclosed homes fell for the 32nd
straight month to just under 650,000 in June.
Most of the U.S. has reduced its shadow inventory to pre-recession
levels, but the Northeast, Florida and the Pacific Northwest remain elevated,"
said Anand Nallathambi, president and CEO of CoreLogic. "The great news here is
that the basic underpinnings of the housing market are strengthening, but there
is still work to do."