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March 4th, 2014

Fewer foreclosures could dampen spring inventory even more

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Foreclosure for SaleA precipitous decline in the number of U.S. home foreclosures this winter could mean fewer bank-owned homes will be for sale this spring.

In January, only 48,000 foreclosures were completed nationally, according to the latest report from CoreLogic, a residential property information and analytics companies, in Irvine, Calif.

Foreclosure inventory drops

That 48,000 total represented a 19 percent decline compared with 59,000 completed foreclosures one year earlier. Yet on a monthly basis, foreclosures rose 11.8 percent from December’s figure of 43,000.

As of January 2014, approximately 794,000 U.S. homes were in some stage of foreclosure, a 33 percent decrease compared with January 2013, CoreLogic reported.

The percentage of U.S. homes in some stage of foreclosure has dropped from 2.9 percent in January 2013 to 2 percent in January 2014, the 27th consecutive month of year-over-year declines, CoreLogic said.

In a statement, CoreLogic CEO Anand Nallathambi said fewer than 1 million homes were in the foreclosure process at the start of 2014.

Housing recovery: ‘Not there yet’

“The painful tide of high foreclosures continues to recede as fewer borrowers are losing their homes,” Nallathambi said. “We expect to see continued progress in the months ahead, but the judicial foreclosure states will continue to lag the rest of the country in working down their backlogs of foreclosed properties.”

CoreLogic Chief Economist Mark Fleming said that the housing sector is recovering, but “we’re not there yet.”

Prior to the housing crash, completed foreclosures averaged 21,000 per month nationwide between 2000 and 2006.

Since September 2008, approximately 4.9 million foreclosures have been completed in the U.S.

Foreclosure states: The usual suspects

Five states account for almost half of all completed foreclosures nationally:

  • Florida
  • Michigan
  • Texas
  • California
  • Georgia

These states also had the highest number of completed foreclosures for the 12 months that ended in January 2014.

Only Florida, along with New Jersey, New York, Connecticut and Maine, also had the highest foreclosure inventory as a percentage of all mortgaged homes in January 2014. Buyers in those states might see more bank-owned homes for sale.

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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