The number of foreclosures continues to drop nationwide – however, the trend has become increasingly spotty in recent months, with foreclosure volume varying considerably from community to community, according to RealtyTrac's U.S. Foreclosure Market Report for August.
For example, foreclosure starts dropped 43% in Florida but jumped 226% in Nevada last month, according to the report.
Nationwide, a total of 128,560 properties were in some stage of foreclosure in August, a decrease of 2% from the previous month and down 34% from August 2012. This includes default notices, scheduled auctions and bank repossessions.
It was the 35th consecutive month that foreclosure activity dropped on an annual basis. About one in every 1,019 U.S. housing units was in some stage of foreclosure last month, according to the report.
A total of 55,775 U.S. properties started the foreclosure process in August, down 44% from August 2012.
Non-judicial states with the largest drops in foreclosure activity, year-over-year, included Colorado (down 80%), Arizona (down 65%), Washington (down 65%), California (down 57%) and Michigan (down 55%). Judicial states with the largest drops included Illinois (down 66%), Massachusetts (down 66%), Florida (down 65%), Indiana (down 43%) and Wisconsin (down 39%).
States with the biggest increases in foreclosure activity, year-over-year, included Nevada (up 226%), Ohio (up 44%), Maryland (up 24%), California (up 12%) and New York (up 8%).
Bank repossessions (REO) increased 6% nationwide in August, compared to the previous month, but were still down 25% from a year ago. REO activity, which fluctuates based on how quickly judicial and non-judicial states process foreclosures, increased on a month-to-month basis in three of the last four months, reaching a five-month high.
States with the largest increase in REO activity included New York (up 123% to a 34-month high), New Jersey (up 63% to a 31-month high), Florida (up 48% to a seven-month high), Ohio (up 46% to an eight-month high) and Indiana (up 41% to a 9-month high).
Nevada supplanted Florida for foreclosure volume. Florida's foreclosure rate fell to second highest followed by Ohio, Maryland and Delaware.
‘The foreclosure floodwaters have receded in most parts of the country, but lenders and communities continue to clean up the damage left behind, which means the recent uptick in bank repossessions is a trend that will likely continue into next year,’ says Daren Blomquist, vice president at RealtyTrac. ‘Meanwhile, foreclosure flash floods will continue to hit some markets over the next few months as delayed foreclosure starts are quickly pushed into the pipeline. This was the case with the jump in Nevada foreclosure starts in August.’
Michael Mahon, executive vice president and broker at HER Realtors, covering the Columbus, Cincinnati and Dayton, Ohio, markets says as home prices continue to increase, ‘We have noticed an increase in lenders taking action on delinquent mortgages."
‘We have lenders in the Ohio market who have stepped up their activity in notifying homeowners who are in default and commencing foreclosure actions, which has added to the amount of foreclosures we are seeing in certain Ohio metros,’ Mahon says. ‘Due to lack of inventory during the summer months, there is a current demand amongst buyers who are ready, willing and able to purchase new inventory being introduced to the market.’
For more, check out the full report.