A surge in scheduled auctions sent the overall rate of foreclosure activity surging in October. In its U.S. Foreclosure Market Report released on Thursday RealtyTrac reported that auctions were scheduled for the first time on 59,869 U.S. properties during the month, the largest number of such filings since May 2013. This represented an increase of 24 percent from the number of such filings in September and a 7 percent increase from the previous October.
The increase occurred in both judicial foreclosure states, a jump of 21 percent month-over-month and an increase of 3 percent from the previous October, and in non-judicial states where there were 27 percent more auctions scheduled than in September and a year over year change of +14 percent. To put things in perspective, however during one month in the spring of 2010 there were 160,000 auctions scheduled.
This spike sent overall foreclosure numbers, which also include default notices and completed foreclosures or bank repossessions up 15 percent from September, the largest month-over-month increase since the peak of activity in March 2010. There were a total of 123,109 properties that received some type of foreclosure filing during the month, one in every 1,069 U.S. housing units. Filings were down 8 percent compared to October 2013.
"The October foreclosure numbers are not a complete surprise given that over the past three years there has been an average 8 percent monthly uptick in scheduled foreclosure auctions in October as banks try to get ahead of the usual holiday foreclosure moratoriums," said Daren Blomquist, vice president at RealtyTrac. "But the sheer magnitude of the increase this year demonstrates there is more than just a seasonal pattern at work. Distressed properties that have been in a holding pattern for years are finally being cleared for landing at the foreclosure auction.
"There is still strong demand from the large institutional investors at the foreclosure auction in some markets, but even in markets with decreasing demand at the foreclosure auction, banks can be confident in selling REO properties quickly and at a good price," Blomquist continued. "That's because there is still strong demand from buyers, particularly in the lower price ranges, combined with a dearth of distressed homes listed for sale."
Scheduled auctions increased from last October in 29 states with increases in Oregon (+399 percent), North Caroline (+288 percent) and New Jersey (+118 percent) far exceeding the national percentage uptick as well as that in other states in the top ten.
There were 27,914 repossessions or completed foreclosures in October, a 22 percent increase from September but down 26 percent compared to a year earlier. It was the largest monthly increase since June 2009. Maryland's bank repossessions grew by 190 percent year over year far overshadowing the states that followed; Pennsylvania, New Jersey, Oregon, and New York all had annual increases of 25 percent or less.
Foreclosure starts also jumped, up 12 percent in October compared to September, the largest monthly increase since August 2011. There were a total of 56,452 properties put into foreclosure during the month.
The highest rate of overall foreclosure activity was in Maryland with a total of 5,942 filings, up 68 percent from September and 30 percent compared to a year earlier. It was the highest number of foreclosure filings in the state since July 2010 with one in every 400 housing units receiving one.
Florida finally fell from its long-time number one position for foreclosure activity to number to in October. One in every 444 housing units in Florida received a filing, a two percent decrease from September and down 25 percent from a year earlier. It was the 15th month when the state saw a decline in overall foreclosure filings.
One in every 596 Nevada housing units had a foreclosure filing in October, the nation's third highest foreclosure rate. Activity in the state jumped by a little more than a third month over month but was still down 31 percent from a year ago.
Other states in the top five for foreclosure activity were Ohio (one in 674 housing units) and Illinois (one in 712 units,)