Foreclosure Filings Soared in 2010


The housing crisis is getting worse. There has been a great deal of evidence to support that. Real estate research firm RealtyTrac has reported that 2010 was particularly bad. The company's Year-End 2010 U.S. Foreclosure Market Report shows "a total of 3,825,637 foreclosure filings -- default notices, scheduled auctions and bank repossessions -- were reported on a record 2,871,891 U.S. properties in 2010, an increase of nearly 2% from 2009 and an increase of 23% from 2008." The report also indicates that "2.23% of all U.S. housing units (one in 45) received at least one foreclosure filing during the year, up from 2.21% in 2009, 1.84% in 2008, 1.03% in 2007 and 0.58% in 2006."

The one good piece of news from the research was the foreclosure problem eased slightly in the last quarter of 2010. "Foreclosure filings were reported on 799,064 U.S. properties in the fourth quarter, a 14% decrease from the previous quarter and an 8% decrease from the fourth quarter of 2009. The fourth quarter total was the lowest quarterly total since Q4 2008."

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A small number of states continue to be the hardest hit. California, Florida, Arizona, Illinois and Michigan account for half of the nation's total filings.

Many analysts believe that housing cannot recover in markets where unemployment is above 10%. Low interest rates on mortgages have not aided home sales, at least not in a measurable way. Government's attempt to rectify the situations have had mixed success. Tax credits, offered early in the year, boosted buying activity, but those benefits expired in April. The Home Affordable Modification Program (HAMP), meant to refinance mortgages to keep people in their homes, was simply a failure.

Another problem that faces the housing recovery is that many potential home buyers believe that prices could go even lower. S&P forecast that home prices could drop another 7% to 10% this year.

James J. Saccacio, chief executive officer of RealtyTrac, offered little hope for the beginning of 2011. He said "many of the foreclosure proceedings that were stopped in late 2010 -- which we estimate may be as high as a quarter million -- will likely be re-started and add to the numbers in early 2011."