Buried in the new HAMP report are some colorful maps, which might indicate an upturn in the housing market for Florida and Nevada — two states that were hit hard by the housing crisis. 

Look at the colors change from map to map. The first map is from the third quarter of 2011, the second is from the fourth quarter. As you can see, both states go from bad to slightly better.



Florida dropped from 20.01% delinquencies or higher to 15.01%-20%. And while that number is still the highest in the country, it’s still better than it was. Similarly, Nevada dropped down one level from 15.01%-20% to 10.01%-15%.

There are two ways to interpret these maps. You could say that the market in both states got a bit better, or you could say that this isn’t an improvement at all, and the numbers dropped because of worked-out kinks in the system.   

The second, while dismal, is probably the most accurate.

As David Rodstein, a foreclosure attorney with the Rodstein Law Group, told HousingWire reporter Jon Prior a couple weeks ago, “It's not as bad as it seems [in Florida]. It's much, much worse.”

The state holds a huge number of backlogged cases. Not surprising when you consider that the average foreclosure in Florida takes nearly 800 days to complete, more than twice the national average, according to RealtyTrac. This huge lag may be the reason that Florida seems to have dropped out of the red — literally.

In which case this means a large portion of mortgages went from delinquency into default, instead of being cured.

The state is trying to fix things by proposing a bill to speed up the process (I discuss the pros and cons of that bill here), and it will most certainly pass. Hopefully it will do as planned and start to streamline the process to rid the state of the glut of pending cases. 

Things are still bad for Nevada, which is commonly considered the epicenter of the housing crisis. The drop there was most likely due to the impact of a law that created additional requirements for lenders foreclosing on properties, which went into effect Oct. 1, 2011. 

It’s likely the default rate won’t continue to drop in Nevada. Home prices have declined by 60% from their peak, and estimates indicate that they’ll fall another 13.9% by the end of this year’s third quarter. That is hardly welcome news for the state’s default rate.