In 57% of Metropolitan Areas, Foreclosures Have Fallen Below Pre-Recession Levels; 2014 FHA Loans Records Highest Rate of Foreclosures for Any FHA Loan Vintage From 2009; Increase of 24 % for Foreclosure Start Ups in Markets Like Cincinnati, Dallas and Denver

Curator of the country’s biggest multi-sourced property database ATTOM Data Solutions published their U.S. Foreclosure Market Report™ for Q3 2017 and it revealed 191,824 U.S. properties in total had foreclosure filings which included notices of default, scheduled actions or repossessions by lenders. Third quarter numbers were down 13% compared to the previous quarter and down 35% from the previous year and are at the lowest levels in over 11 years since Q2 of 2006.

In Q3 2017, foreclosure activity in the U.S. was 31% down from the pre-recession average, which was 278,912 that had filings for foreclosure per quarter from Q1 2006 to Q3 2007 which marked four straight quarters that U.S. foreclosure activity has been lower than average before the recession.

Daren Blomquist, ATTOM Data Solutions’ Senior VP said those legacy foreclosures that started with the high-risk loans from 2004 to 2008 have mostly been removed from the pipeline of the distressed market. However, loans that were issued during the past five years of the housing boom are tracking foreclosure rates that are below the historical averages. There was an exception for FHA loans that started in 2014 and they have the highest rate of foreclosure of any FHA mortgage loan vintage as of 2009, which is 29% over the historic FHA loan averages, but still 55% less than the 2007 peak.

Foreclosure stats down across the nation, but are up in 24% of local markets

In Q3 of 2017, lenders began the process for foreclosures on 93,724 properties in the U.S., which is a decline of 7% compared to Q2 and down 16% from the previous year to the lowest level since 2005 when ATTOM started tracking these stats.

Contrary to the trend in 51 (or 24% of the 217 locations evaluated in the report) metropolitan areas across the nation had a year-over-year rise in foreclosure rates in Q3 2017. Affected areas included Cincinnati, Ohio (5% rise); Dallas-Fort Worth, Texas (6% rise); Denver, Colorado (12% rise); Columbus, Ohio (23% rise) and Cleveland, Ohio (29% rise);

Other large metropolitan areas that had a year-over-year increase in foreclosure rates in Q3 2017 include Milwaukee, Wisconsin (up 97%);   Oklahoma City, Oklahoma (up 34%); Austin, Texas (up 29%); Louisville, Kentucky (up 27%) and Nashville, Tennessee (up 17%).

Rates of foreclosure on 2014 FHA vintage loans reached an 11-year high in Denver and Austin. Nashville and Oklahoma City have experienced 10-year high rates and in Dallas, Cleveland, Columbus and Cincinnati rates are at a 9-year high.

57 % of local markets are experiencing foreclosure activity below pre-recession rates

Foreclosure activity in Q3 was under pre-recession averages in 123 of 217 (57%) metropolitan areas that were evaluated in the report and included cities like Houston, Miami, Chicago, Los Angeles and Dallas.

 

Matthew Gardner, Windermere Real Estate’s Chief Economist said that there is a downward trend in Seattle’s foreclosure activity and is currently at rates not observed since the first publication of the report. Foreclosure activity in Q3 was 46% under the pre-recession averages. Gardner went on to say that the marketplace is hungry for products and this is driving up prices much higher than average rates. As a result, housing values have rebounded for virtually every housing unit which was in negative equity. This is the reason foreclosure activity has plummeted to very low levels.

Contrary to the trend nationwide, the foreclosure activity in Q3 of 2017 was over pre-recession averages in 94 of  217 (43%) of metropolitan areas evaluated in the report, which included cities like Baltimore, New York, Washington, D.C, Virginia Beach and Philadelphia

Atlantic City, Cleveland, Trenton Experience the Highest foreclosure rates

The report analyzed over 200,000 people in 217 metro areas and in Q3 2017 Atlantic City, New Jersey had the highest foreclosure rate where 1 out of every 150 housing units had filings for foreclosure; Trenton, New Jersey (1 in 234); Fayetteville, North Carolina (1 in 283); Cleveland, Ohio (1 in 275);  and Columbia, South Carolina(1 in 284).

 

A new record high reached for average foreclosure timeline
In Q3 2017, 55,993 properties in the U.S went through the lender’s foreclosure process (REO), which is a 29% decrease from Q2 and a decrease of 35% from the previous year and is currently at the lowest rate since Q3 in 2006.

 

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