Foreclosure Filings Drop, But Recovery Still a Flop
Foreclosure filings in the first quarter have dropped below early 2008 levels, according to a report released Thursday by housing analytics company RealtyTrac. The filings, which include default notices, scheduled auctions and bank repossessions, reflect 681,153 properties, down 14.8 percent from the previous quarter and 26.9 percent from the beginning of 2010. In real terms, one in every 191 residential properties received a foreclosure filing during the quarter.
But the slowdown in foreclosure filings doesn't necessarily mean the market is on the rebound. In fact, a driving factor behind the decrease in foreclosures is the ongoing federal investigation of the nation's largest lenders in connection with faulty foreclosure paperwork.
"Weak demand, declining home prices and the lack of credit availability are weighing heavily on the market," said James Saccacio, CEO of RealtyTrac, in a press release. In addition, he said, the market is still facing two threats: The looming shadow inventory that has yet to be hit the market and the likelihood that foreclosure activity will pick up once the backlog of filings is processed.
On a state level, Nevada has the highest rate of foreclosure in the nation, with one in every 35 homes in foreclosure proceedings. Other states facing some of the highest rates of foreclosure in the nation include Texas (34,646), Illinois (33,092), Nevada (32,066), Ohio (24,697) and Colorado (13,847).
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