Foreclosure starts fell to a six-year low in January as the state of Florida took the dubious distinction of becoming the state with the most foreclosure filings, RealtyTrac said Thursday.
The Irvine, Calif.-based real estate research firm said foreclosure filings fell 28% year-over-year, declining to 150,864 filings in January, a 7% drop from December.
U.S. foreclosure starts also fell to a 79-month low, reaching levels not seen since June 2006.
About one out of every 869 housing units faced a foreclosure filing in January, according to RealtyTrac data.
The company’s vice president Daren Blomquist highlighted a significant transition that caused the state of California to no longer lead the nation in monthly foreclosure filing activity.
Blomquist says the enactment of the California Homeowner Bill of rights, which essentially bans dual tracking and creates a private right of action for borrowers to challenge foreclosure processes in court, shifted foreclosure filing levels in the state. Blomquist and other housing analysts have suggested the legislation would end up turning California into a judicial foreclosure state. The law first took effect in January 2013.
"As a result, the downward foreclosure trend in California accelerated into hyper speed in January, decisively shifting the balance of power when it comes to the nation’s foreclosure activity," Blomquist explained.
"For the first time since January 2007 California did not have the most properties with foreclosure filings of any state. Instead that dubious distinction went to Florida, where January foreclosure activity increased on an annual basis for the 11th time in the last 13 months."
The states with the highest foreclosure rates included Florida, Illinois and Nevada. In Florida, one in every 300 housing units faced a foreclosure filing last month, which is twice the national average. One in every 344 housing units faced a foreclosure filing in Nevada, while Illinois data shows one in every 375 units at risk of foreclosure.