Even with bank-constricted pipeline, some foreclosures auctions rise
Foreclosures in some markets are on the rise, according to one survey of courthouse auctions. However, the numbers do not indicate a peak in foreclosure sales has been reached.
"Despite months of slow sales, we've simply returned to prior levels, which to me indicates banks remain reluctant to aggressively foreclose despite the time it takes to foreclose being at or near record levels," said Sean O'Toole, founder and CEO of ForeclosureRadar. "And large inventories of properties [are] still scheduled for foreclosure sale."
Foreclosure auction sales grew as much as 50% in some states during January as foreclosure moratoriums came to an end, sending hundreds of distressed properties back to the auction block, foreclosure data firm said Tuesday.
"While the increase is significant, we've seen larger surges after moratoriums or delays have played out in the past," said O'Toole in an email. "For example in California after the delays caused by Senate Bill 1137 we saw a surge in Notice of Default filings that far eclipsed any prior period. That is not the case here."
In Arizona, notice of trustee filings jumped 10.9% between December and January, the first increase recorded in six months. Foreclosure sales in Arizona also spiked with ForeclosureRadar recording a 56.2% rise in the number of homes sold back to the bank. The southwestern state also experienced a 52.7% increase in foreclosure sales to third-parties on a month-over-month basis in January.
California -- one of the state's hit the hardest by unemployment and falling real estate prices during the recession -- saw its back-to-bank foreclosure sales jump 51.1% between December and January. Sales of foreclosed homes to third parties in California also rose 52.8%.
The Golden state reported a 6.9% rise in notice of default filings on a month-of-month basis, reversing a four-month decline in new defaults. At the same time, notice of trustee sale filings in California dropped 13.8%, turning one negative trend positive.
Oregon and Washington also recorded back-to-bank foreclosure sale increases of 33.4% and 54%, respectively. In terms of sales to third parties, Oregon noted a 70% jump in activity, compared to a 23% jump in Washington.
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