CoreLogic reported on Tuesday that the foreclosure inventory, the number of homes in some stage of foreclosure, had dropped to 390,000 in May, representing 1 percent of all mortgaged homes in the U.S. This is a 24.5 percent decline from a year earlier when the inventory contained 517,000 homes, a rate of 1.3 percent. The May 2016 foreclosure inventory rate is the lowest for any month since October 2007 and was down 3.0 percent compared to April 2016.
The company's May 2016 National Foreclosure Report also shows the number of completed foreclosures nationwide decreased from 41,000 in May 2015 to 38,000 in the most recent period and were 67.9 percent below the September 2010 peak of 117,813. However, there were 2,000 more completed foreclosures in May than in April and the incidence is still running well above the 21,000 foreclosure average in the years preceding the housing crisis. There were 461,638 Foreclosures in the 12-month period ended in May 2016 compared to just over 560,000 in the 12-month period ended a year earlier.
The serious delinquency rate (90 or more days past due including loans in foreclosure) declined to 2.8 percent, the lowest in more than eight years and a 21.6 percent decrease from May 2015. The total number of seriously delinquent loans in May was 1.1 million.
"The foreclosure rate fell to 1 percent in May, which is twice the long-term average of 0.5 percent. However, this masks the underlying progress at the state level," said Dr. Frank Nothaft, chief economist for CoreLogic. "Twenty-nine states had foreclosure rates below the national average, and all but North Dakota experienced declines in their foreclosure rate compared to the prior year."
"Delinquency and foreclosure rates continue to drop as we experience the benefits of a combination of tight underwriting, job and income growth and a steady rise in home prices. We expect these factors to remain in place for the remainder of this year and for delinquency and foreclosure rates to decline even further," said Anand Nallathambi, president and CEO of CoreLogic. "As we finally move past the housing crisis, we need to increase our focus on expanding the supply of affordable housing and access to credit for first-time homebuyers in sustainable ways to ensure the long-term health of the U.S. housing market."
The five states with the highest number of completed foreclosures were Florida (63,000), Michigan (45,000), Texas (27,000), Ohio (23,000) and California (23,000). These five states account for almost half of all completed foreclosures nationally.
Four states and the District of Columbia had the highest foreclosure inventory rate: New Jersey (3.6 percent), New York (3.2 percent), Hawaii (2.1 percent), the District of Columbia (2.0 percent) and Maine (1.9 percent).