Virginia Foreclosures Nearly Triple in a Year

Last Month's Rate Was 10th Highest in U.S.

Foreclosures in Virginia nearly tripled last month compared with July '07, with Northern Virginia accounting for more than half of the foreclosures.

Fairfax County had 1,728 homes in some stage of foreclosure last month, according to RealtyTrac, which monitors filings throughout the country. In Loudoun County, one of every 169 homes was in foreclosure.

Prince William County continues to have the highest rate, with one of every 103 homes in a state of foreclosure, including default notices, auction sales and bank repossessions.

Arlington County had far fewer, with one of every 1,357 homes in foreclosure.

Virginia had the 10th-highest rate in the country last month, with 5,745 foreclosure filings, RealtyTrac reported. The number of homes in the United States facing foreclosure in July jumped 55 percent from the year before.

"Bank repossessions . . . continued to be the fastest-growing segment of foreclosure activity in July," James J. Saccacio, chief executive officer of RealtyTrac, said in a statement. "The sharp rise in [bank repossessions], combined with slow sales, has resulted in a bloated inventory of bank-owned properties for sale."

There is a silver lining. Home sales have increased throughout most of the region, as high-priced houses become more affordable. The sizable price decreases in Prince William have attracted first-time home buyers and investors who want to take advantage of the deals, according to the Virginia Association of Realtors.

The median price of a home in Prince William last month was $214,000, compared with $354,450 in July 2007, according to Metropolitan Regional Information Systems. Nearly 550 more homes were sold last month than in the previous July.

In Loudoun, the median home price decreased 20 percent from July 2007. The number of homes sold, however, has increased only marginally. Home prices in Fairfax were down about 17 percent, with little effect on the number of homes being sold.

Experts said that although the trend is promising, the housing market will not fully recover until foreclosures are absorbed.

A report from the Virginia Association of Realtors points to "dramatic" differences between Northern Virginia and other parts of the state. The association said it expects regional sales activity "to widen in the next quarter before the overall housing market edges back toward equilibrium."

Virginia is almost like two different states, said Rick Sharga, senior vice president of RealtyTrac. "Northern Virginia tends to behave a little differently because of its proximity to the Beltway," he said.

Ranking 10th in the country isn't necessarily a bad thing, Sharga said, because foreclosure rates in the top six states, including California and Florida, are much more severe.

"It's not a catastrophe in the making," he said. Sharga predicts an improvement in the local housing market by early next year. "After the election in November, there will be an influx of new jobs, regardless of who takes office," he said.