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Foreclosure continues to drop nationwide

February 22, 2018

For some time, the number of distressed properties seen across the country has been on a steady downward course that has pushed instances of people missing mortgage payments to some of the lowest levels ever seen in the housing market. That trend certainly continued in 2017 as the rate at which homeowners were foreclosed upon dropped once again.

"Foreclosures made up just 0.51% of all housing units in 2017."

Across the U.S., slightly more than 676,500 homes were hit with foreclosure filings of any kind last year, making up just 0.51 percent of all housing units, according to the latest U.S. Foreclosure Market Report. Both were the second-lowest levels observed in the market since 2005, and the total number was down 76 percent from the all-time foreclosure peak set in 2010, when more than 2.87 million homes were in the process.

A closer look at the data
Interestingly, there was a 1 percent uptick in filings from November to December, but the latter month's number was still down 25 percent year over year, the report said. That marked the 27th month in a row in which there was decline in foreclosure activity on an annual basis.

"Thanks to a housing boom driven primarily by a scarcity of supply, which has helped to limit home purchases to the most highly qualified - and low-risk - borrowers, the U.S. housing market has the luxury of playing a version of foreclosure limbo in which it searches for how low foreclosures can go," said Daren Blomquist, senior vice president at ATTOM Data Solutions.

However, some markets are lagging behind the national trend, a few significantly so. For instance, New York City saw a 58 percent increase in foreclosed homes that were put up for auction last year, according to Property Shark. In all, more than 3,300 homes were auctioned for the first time, up from a low of just 936 in 2012, as well as fewer than 2,100 in 2016.

Early foreclosure filings also down
However, it's also expected that national foreclosure rates could continue to decline for some time to come, because pre-foreclosure - which precedes future activity such as auctions and repossessions - continues to fall as well, according to the RealtyTrac. In December 2017 - the latest month for which data is available - these early-stage actions were down 3.9 percent percent nationwide from November, and fell from 26.1 percent year over year.

Consequently, these new foreclosure actions made up the single smallest portion of all types of foreclosure filings at just 29.5 percent, the report said. Meanwhile, auctions - which dropped even more sharply than pre-foreclosure, down 17.1 percent monthly and 33.8 percent annually - made up 31.6 percent of all foreclosure actions. Finally, bank repossessions amounted to nearly 39 percent of actions, up 27 percent from November but still down 14.1 percent from December 2016.

Homeowners being able to keep up with their mortgage payments is generally good news for the housing market as a whole. With continued expectations for declines in delinquency and foreclosure going forward, it's likely the market will remain healthy throughout 2018 at least.

 

 

 

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