The number of foreclosures rose during the first three months of the year in more than half of the nation’s metropolitan areas, even as such activity dipped from the previous year in many of those cities, according to a report released Thursday by the research firm RealtyTrac.
The numbers show that foreclosures increased during the first quarter in 26 of the country’s 50 largest metro areas, with the highest jumps in Pittsburgh, Indianapolis and Philadelphia. The most significant decreases came in Portland, Las Vegas and Providence, R.I.
“First-quarter metro foreclosure trends were a mixed bag,” RealtyTrac chief executive Brandon Moore said in a statement. “While the majority of metro areas continued to show foreclosure activity down from a year ago, more than half reported increasing foreclosure activity from the previous quarter — an early sign that long-dormant foreclosures are coming out of hibernation in many local markets.”
Many experts expect foreclosures to surge in coming months in parts of the country, in the wake of a $25 billion settlement between major banks and government officials over shoddy foreclosure practices. Many banks and mortgage servicers had halted or delayed foreclosures while that deal was pending.
A new wave of foreclosures could drag down home prices in the short term but eventually help to boost the housing market by clearing backlogged inventories and putting new owners into long-vacant homes.
Despite the falling foreclosure numbers in some areas, foreclosure rates remain inordinately high in parts of the country hit hardest by the housing bust, including Florida, Nevada and California. In Stockton, Calif., one in every 60 housing units had a foreclosure filing during the first quarter of 2012, according to RealtyTrac.
Also on Thursday, new data from the National Association of Realtors showed that pending home sales rose during March to levels well above a year ago, another signal that the wounded housing market could be inching slowly toward recovery. The association’s pending home sales index, which reflects contract signings but not closings, rose 4.1 percent in March and is now at its highest level since April 2010.
“First quarter sales closings were the highest first quarter sales in five years. The latest contract signing activity suggests the second quarter will be equally good,” NAR chief economist Lawrence Yun said in a statement. “The housing market has clearly turned the corner. Rising sales are bringing down inventory and creating much more balanced conditions around the county, which means home prices will be rising in more areas as the year progresses.”
The muddled economic picture extends beyond just the housing market. In other data reported Thursday, the Labor Department said that slightly fewer Americans filed for unemployment benefits last week, but the numbers did not shrink as much as many economists had expected.
Data showed that seasonally-adjusted jobless claims dropped to 388,000 for the week ending April 21, down 1,000 from the week before. But the Labor Department’s four-week moving average, which offers a more accurate gauge of the direction of jobless claims, increased by 6,250 to 381,750, the highest level since early this year and a sign that the job market’s momentum could be slowing after several months of encouraging news.