Foreclosure activity rises in most major metropolitan areas
Friday, July 30, 2010
Foreclosure activity climbed in three-quarters of the largest U.S. metropolitan areas in the first half of 2010, compared with the same period a year ago, but declined in some of the nation's hardest-hit regions, according to data released Thursday.
The number of properties in some stage of foreclosure rose during the first six months of the year in 154 of the 206 metropolitan areas with a population of 200,000 or more, foreclosure listing firm RealtyTrac said in a report.
The 20 regions with the worst foreclosure rates were in the four states -- Florida, California, Nevada and Arizona -- where home prices climbed fastest during the boom years and crashed hardest during the crisis. Nine of the areas on the list were in Florida, eight in California, two in Nevada and one in Arizona.
Nationwide, more than 1.6 million properties were in some stage of foreclosure in the first half of the year, according to RealtyTrac, up about 8 percent from a year ago but down 5 percent from the final six months of 2009.
In the Washington region, foreclosure activity fell 5.4 percent from a year ago and nearly 18 percent from the previous six months. About 1 in 78 D.C. area loans was in some state of foreclosure from January through June.
Foreclosures tend to drag down home prices and undermine the housing market's stability. The nation's stubbornly high unemployment rate and the lending community's increased willingness to sell foreclosed properties are boosting the number of foreclosures hitting the market.
For a period, lenders were under political pressure to delay foreclosures and modify troubled loans. But as lenders get a better handle on which loans cannot be salvaged, they are starting to complete more foreclosures and put those homes on the market.
However, there are "early signs" that foreclosures might have peaked in some of the most-troubled regions, James J. Saccacio, RealtyTrac's chief executive, said in a statement. Foreclosure activity dropped in nine of the 10 most-severely affected areas. Even so, the rates still remain three to five times as high as the national average.
The Las Vegas area still has the nation's highest foreclosure rate, with 6.6 percent of its housing units receiving a foreclosure filing in the first half of the year. But the number of filings fell 15 percent from the second half of 2009 and 9 percent from the first six months of last year.
Foreclosure activity in the Cape Coral-Fort Myers area of Florida, which had the second-highest rate among U.S. metropolitan regions, at 4.98 percent, also slipped. The foreclosure rate there in the first half of the year is down 30 percent from a year ago and 22 percent from the previous six months.
Thomas Lawler, a housing consultant, attributes the declines in those regions to a high concentration of exotic loans that went bad and cleared the system.
In other areas, "more of the loans are running into problems not because loans were bad but because the economy stinks," hence the rise in foreclosure activity, Lawler said.
The report collects data from 2,200 counties nationwide that make up more than 90 percent of the U.S. population. Some of the foreclosure filings captured in the first half of this year may have been recorded in previous time periods.