Foreclosure Starts Increase in October


Foreclosure starts rose in October, according to the recent RealtyTrac® U.S. Foreclosure Market Report™ for October 2015, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 115,134 U.S. properties in October, an increase of 6 percent from the previous month but still down 6 percent from a year ago. The report also shows one in every 1,147 U.S. housing units with a foreclosure filing during the month.
 
The 6 percent monthly increase in overall foreclosure activity was caused primarily by a 12 percent monthly jump in foreclosure starts, with 48,605 properties starting the foreclosure process for the first time in October. The October monthly increase was the largest month-over-month increase since August 2011, when there was a 24 percent month-over-month increase. Despite the month-over-month increase, foreclosure starts in October were still down 14 percent from a year ago.

“We’ve seen a seasonal increase in foreclosure starts in October for the past five consecutive years, so it’s not too surprising to see the monthly increase this October,” says Daren Blomquist, vice president at RealtyTrac. “However, the 12 percent increase this October is more than double the average 5 percent monthly increase in the past five Octobers, and the even more dramatic monthly increases in some states is certainly a concern. The upward trend in foreclosure starts in those states in some cases could be an indication of fissures in economic fundamentals driving more distress and in other cases is more likely an indication of long-term delinquencies finally entering the foreclosure pipeline.”
 
October foreclosure starts increased from the previous month in 34 states, including California (up 21 percent), Florida (up 13 percent), New Jersey (up 15 percent), Illinois (up 20 percent), Maryland (up 300 percent), Washington (up 34 percent), and Michigan (up 37 percent).

Bank Repossessions Increase Annually in 36 States

There were a total of 36,582 properties repossessed by lenders (REOs) in October, down 9 percent from the previous month but up 31 percent from a year ago — the eighth consecutive month with a year-over-year increase in REOs. Despite the annual increase, REOs in October are about one-third of their peak of 102,134 in September 2010. Through the first 10 months of 2015 there have been 369,920 completed foreclosures, up 33 percent from 277,815 REOs during the same time period in 2014.

REOs increased from a year ago in 36 states in October, including New York (up 320 percent), New Jersey (up 275 percent), Texas (up 119 percent), North Carolina (up 89 percent), Nevada (up 83 percent), and Illinois (up 62 percent).

Those states that saw the most completed foreclosures for the month included Florida (5,760 REOs), California (2,697 REOs), Illinois (2,624 REOs), New Jersey (1,960 REOs) and Texas (1,776 REOs).

Scheduled Foreclosure Auctions Increase Annually in 17 States

A total of 46,698 U.S. properties were scheduled for foreclosure auction during the month, up 12 percent from the previous month but down 22 percent from a year ago.

Scheduled foreclosure auctions — which can be foreclosure starts in some states — increased from a year ago in 17 states, including New York (up 47 percent), Massachusetts (up 45 percent), North Carolina (up 24 percent), New Jersey (up 17 percent), and Maryland (up 3 percent).

Maryland, New Jersey, Florida, Nevada and Illinois Post Highest State Foreclosure Rates

A total of 5,126 Maryland properties had a foreclosure filing in October, up 100 percent from the previous month, but still down 14 percent from a year ago. After dropping out of the top five state foreclosure rates in September for the first time in 2015, Maryland’s foreclosure rate jumped to No. 1 in October thanks to the surge in foreclosure starts. One in every 466 Maryland housing units had a foreclosure filing in October, more than 2.5 times the national foreclosure rate.

The state of New Jersey accounted for 7,559 properties receiving a foreclosure filing in October, a foreclosure rate of one in every 471 housing units — second highest among the states after New Jersey’s foreclosure rate ranked No. 1 in September. New Jersey foreclosure activity in October decreased 4 percent from the previous month, but was still up 87 percent from a year ago — the eighth consecutive month with a year-over-year increase in New Jersey foreclosure activity.

One in every 579 Florida housing units received a foreclosure filing in October, the nation’s third highest state foreclosure rate. Florida’s foreclosure rate has ranked in the Top 5 each month in 2015.  Florida foreclosure activity increased 8 percent from the previous month but was still down 23 percent from a year ago.
Nevada foreclosure activity decreased 6 percent from the previous month, but increased 1 percent from a year ago, giving the state the nation’s fourth highest state foreclosure rate: one in every 593 housing units with a foreclosure filing.

Illinois foreclosure activity increased 21 percent from the previous month, and the state posted the nation’s fifth highest foreclosure rate: one in every 680 housing units with a foreclosure filing.

Other states with foreclosure rates among the nation’s 10 highest in October were South Carolina at No. 6 (one in every 751 housing units with a foreclosure filing); North Carolina at No. 7 (one in every 901 housing units); Ohio at No. 8 (one in every 968 housing units); New Mexico at No. 9 (one in every 1,020 housing units); and Washington at No. 10 (one in every 1,102 housing units).

New Jersey, Maryland and Florida Cities Post Highest Metro Foreclosure Rates

October marked the 4th consecutive month where the Atlantic City, New Jersey metro remained in the No. 1 spot for having the highest foreclosure rate among metropolitan statistical areas with a population of 200,000 or more. One in every 257 Atlantic City housing units had a foreclosure filing in October, more than four times the national average. Atlantic City foreclosure activity in October increased 14 percent from previous month — driven by a 26 percent monthly spike in foreclosure starts — and increased 134 percent increase from a year ago.
 
Foreclosure activity in October increased 177 percent from a year ago in Columbia, South Carolina, and the metro area posted the nation’s second highest foreclosure rate: one in every 333 housing units with a foreclosure filing.

Other metro areas with foreclosure rates in the top 10 highest were Baltimore, Maryland at No. 4 (one in every 429 housing units with a foreclosure filing); Fayetteville, North Carolina at No. 5 (one in every 460 housing units); Jacksonville, Florida at No. 6 (one in every 465 housing units); Miami, Florida at No. 7 (one in every 480 housing units); Rockford, Illinois at No. 8 (one in every 486 housing units); Palm Bay-Melbourne-Titusville, Florida at No. 9 (one in every 514 housing units); and Tampa, Florida coming in at No. 10 (one in every 543 housing units).
 
For more information, visit http://www.realtytrac.com/.

Reprinted with permission from RISMedia. ©2015. All rights reserved.

 

 

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