Foreclosures Now at 8-Year Low, RealtyTrac Reports

For Sale Real Estate Sign With Foreclosure Notice
ShutterstockForeclosure starts are at their lowest level since 2005 and in May were down 32 percent from a year ago.

By Elvina Nawaguna

Foreclosure activity across the United States dropped to an eight-year low in May as banks reclaimed fewer homes and foreclosure starts saw their lowest levels in years, RealtyTrac said in a report on Tuesday. RealtyTrac, which tracks and maintains housing market data, said 109,824 properties across the country were at some stage of the foreclosure process in May. That marked a 5 percent decline from April and left foreclosure activity -- foreclosure notices, scheduled auctions and bank repossessions -- 26 percent below the year-ago level.

May was the 44th consecutive month foreclosure activity was down on an annual basis, a sign of the housing market's steady progress toward recovery. "This is showing that foreclosures are fading further into the rear-view mirror in most places," Daren Blomquist, vice president for RealtyTrac, told Reuters. "This is good news for the housing market."

Lenders reclaimed a total of 28,373 properties in May, down 6 percent from April and the lowest level since July 2007. Repossessions were down 27 percent from a year ago. Nationwide, 47,085 properties were set for foreclosure auctions, the fewest since December 2007, the month the nation fell into recession.

Foreclosure starts also were at a multiyear low, with lenders starting the process on 49,240 properties in May, down 10 percent from the previous month and down 32 percent from a year ago. The decline brought starts to their lowest level since December 2005. With one in every 436 homes in foreclosure, Florida continued to have the nation's highest foreclosure rate, followed by Maryland, Nevada and Illinois.

"I think the numbers will continue to drop and could flatline by early next year," Blomquist said.