Foreclosures Up in Some Areas, Down in Others…


RealtyTrac yesterday announced that in September overall foreclosure activity decreased from a year ago in 33 states, but actually was up from a year ago in 16 states, including Maryland (up 230 percent), Nevada (up 97 percent), Connecticut (up 69 percent), New Jersey (up 55 percent), Pennsylvania (up 34 percent), and New York (up 22 percent).

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Pack your Bags for Baltimore, Boys.  The Rush is On.

Funny thing about today’s foreclosure market.  Those parts of the nation that were fortunate enough to be spared the devastation wrought sleazy lenders and the Great Recession now are getting there’s.  And in every case, the pain is coming not from the market place but the statehouses where well-meaning but ill-conceived legislation is delaying, not preventing, foreclosures.

Ain’t This a Great Country? Pay Me Now or Pay Me More Later.

So if you’re in the real estate investment business, whether you flip ‘em or hold ‘em, pack your bags for points East and North, judicial state territory, because foreclosure discounts are back in business and distressed sale inventories are actually growing.

Here’s the Latest from the Folks at RT:

  • Third quarter foreclosure starts increased from a year ago in 11 states, including Maryland (up 259 percent), Oregon (up 252 percent), New Jersey (up 53 percent), Connecticut (up 52 percent), Nevada (up 36 percent), and New York (up 25 percent).
  • A quarterly increase in REOs nationwide was driven by quarterly increases in 26 states, including New York (up 65 percent), New Jersey (up 64 percent), Illinois (up 44 percent), Virginia (up 36 percent), Connecticut (up 34 percent), Indiana (up 30 percent), Nevada (up 29 percent), and California (up 19 percent).
  • September foreclosure activity decreased from a year ago in 144 of the 209 metro areas tracked in the report (69 percent), but increased from a year ago in 64 metros (31 percent), including Baltimore (up 381 percent), Las Vegas (up 109 percent), Raleigh, N.C. (up 97 percent), Hartford, Conn., (up 74 percent), Washington D.C., (up 52 percent), Philadelphia (up 32 percent), and New York (up 25 percent).  That right, 381 percent, and Baltimore is a big place.

Florida foreclosure activity in the third quarter decreased 8 percent from a year ago following six consecutive quarters with annual increases in foreclosure activity, but the state still posted the nation’s highest foreclosure rate during the quarter. A total of 70,902 Florida properties had foreclosure filings in the third quarter, down 7 percent from the previous quarter and a rate of one in every 126 housing units — more than twice the national average.

Nevada’s foreclosure activity in the third quarter increased 10 percent from the previous quarter and was up 21 percent from a year ago. The state’s foreclosure rate ranked second highest in the nation. A total of 9,033 Nevada properties had foreclosure filings in the third quarter, a rate of one in every 128 housing units.

A 180 percent year-over-year increase in foreclosure activity helped boost Maryland’s third quarter foreclosure rate to third highest among the states. A total of 11,617 Maryland properties had foreclosure filings during the quarter, up 6 percent from the previous quarter and a rate of one in every 204 housing units.

Why Is Foreclosure Activity Climbing?

“The sharp jumps in foreclosure activity in some local markets may come as a surprise to some,” said RT’s Daren Blomquist. “These spikes in activity demonstrate that while millions of distressed homeowners have been pulled back from the precipice by foreclosure prevention programs over the past several years, once those programs expire or are exhausted, a percentage of these troubled homeowners are still susceptible to falling into foreclosure. In addition even slight economic downturns at the local or regional level can push these homeowners hanging on by a thread over the edge.”

So if you’re ready to go where the foreclosure gold is, there’s no hurry.  While the average foreclosure takes 551 days to process, up 5 percent from 526 days in the second quarter and up 44 percent from 382 days in the third quarter of 2012, things are taking a little longer in the new hotbed states like New York (1,037 days), New Jersey (1,014) days, Illinois (828 days) and Connecticut (693 days).
Photo Credit: Stuck in Customs

About Author

Steve Cook is the editor of Real Estate Economy Watch and writes for a several leading outlets in addition to BiggerPockets, including Equifax and Total Mortgage. He also provides communications consulting services to leading real estate companies. Previously he was vice president of public affairs for the National Association of Realtors.

1 Comment

  1. In Vegas we saw a huge spike in NOD’s in Sept due to banks filing prior to new laws like SB321 going into affect Oct1 2013. Immediately after the Oct 1st mark it dropped to about 15 a day. We are not expecting a huge influx of REO inventory until later in 2014. Inventory is climbing here without the REO inventory though. The REO inventory only makes up about 8% of the available listings in Vegas right now.

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