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Rate of foreclosure nationwide continues long slide

June 1, 2017

The constricted inventory of homes for sale across the country - and in several major metro areas in particular - has been a major issue for the housing market for some time. The fact that nationwide foreclosure numbers have been sliding since the recession came to an end certainly hasn't helped matters, as these properties typically provide value to would-be buyers and keep price increases depressed. Nonetheless, the trend of declining foreclosure activity continued unabated in April.

"Foreclosure filings in April were down 7% from March."

In all, slightly more than 77,000 foreclosure filings were submitted nationwide in April, a number that was down 7 percent from March and 23 percent from April 2016, according to the latest U.S. Foreclosure Market report from ATTOM Data Solutions. This latest figure was the lowest observed for any single month since November 2005, well before the housing market crash truly hit.

"Foreclosure activity continued to search for a new post-recession floor in April thanks in large part to the above-par performance of mortgages originated in the past seven years," said Daren Blomquist, senior vice president at ATTOM Data Solutions. "Meanwhile we are seeing an elevated share of repeat foreclosures on homeowners who often fell into default several years ago but have not been able to avoid foreclosure despite the housing recovery."

Repeats a problem?
Interestingly, the fact that large numbers of new foreclosure filings in April came on properties that had already been in the process at least once was particularly prevalent in several markets, including New York City, according to the New York Post. There, about half of all new foreclosures filed in April were repeats, and that share was up from just 5 percent in 2008, soon after the downturn began. Moreover, nearly 3 in every 4 foreclosures seen in the Empire State over the past year were repeat foreclosures, an increase from just 20 percent in 2007.

"3.86 million properties avoided foreclosure through the FHFA."

Government assistance may help
Declining instances of delinquency, default and foreclosure nationwide may have come in the form of assistance from the federal government. Through the end of February, more than 3.86 million properties have avoided foreclosure with assistance from the Federal Housing Finance Agency, including more than 14,500 in February alone, the FHFA reported. More than half of those issues - about 2.04 million - have been avoided with the help of permanent loan modifications.

Meanwhile, the number of serious delinquencies on home loans backed by Fannie Mae and Freddie Mac - both of which are overseen by the FHFA - fell to just 1.11 percent of all properties with outstanding loan balances, down from 1.12 percent in January, the agency reported.

The inventory of homes for sale across the country is likely to remain constricted for some time to come, which will only lead to prices rising even higher for would-be buyers in the months ahead. With this in mind, hopeful shoppers may need to do more to ensure they can avoid any pitfalls when it comes to actually being able to afford a purchase.




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