Forclosures Could Top One Million This Year
Despite being pushed to the back pages of the newspaper by the Gulf oil spill, financial reform and many other issues, foreclosures remain historically high and are a continuing drag on the economy.
Foreclosures could top one million this year, according to RealtyTrac. In the first six months of the year, foreclosures totaled 528,000.
“It is almost a certainty that we will see over a million over the course of the year, and that would definitely be a record,” Rick Sharga, RealtyTrac senior vice president. “It’s serious, but it doesn’t appear to be that these levels will crater the housing market if the economy at least stabilizes and we do start to see some job creation.”
If foreclosures do top one million this year, that will dwarf the average of 100,000 in a typical year. It will also top the 900,000 foreclosures recorded last year.
Currently there are 7.3 million homes in American that are in some state of delinquency. Through the first six months of the year, 1.7 million homeowners received some form of foreclosure-related warning. That is roughly equal to one in 78 U.S. homes.
The poor housing market continues to be a drain on the economy. The high number of foreclosures is causing property values across the nation to fall. And the problem could persist for up to another three years.
“The roller coaster pattern of foreclosure activity over the past 12 months demonstrates that while the foreclosure problem is being managed on the surface, a massive number of distressed properties and underwater loans continues to sit just below the surface, threatening the fragile stability of the housing market,” James J. Saccacio, chief executive officer of RealtyTrac.
Nevada come in with the nation’s top foreclosure rate. One in seven homes in the state received at least on foreclosure filing in the first six months of the year. Arizona came with the second highest rate, with one in 30 homes receiving a foreclosure filing. California, Utah, Georgia, Michigan, Idaho, Illinois and Colorado rounded out the top 10 in terms of foreclosure rates.
California had the highest total in terms of the sheer number of foreclosures. 340,740 California homeowners received at least one filing in the first six months of the year. While that reflects a poor housing market, it is an improvement as filings are down 15 percent from the previous six months and down 13 percent from the first six months of 2009. Florida came in second, followed by Arizona and Illinois.
“The midyear numbers put us on pace to exceed 3 million properties with foreclosure filings by the end of the year, and more than 1 million bank repossessions,” Saccacio continued. “The roller coaster pattern of foreclosure activity over the past 12 months demonstrates that while the foreclosure problem is being managed on the surface, a massive number of distressed properties and underwater loans continues to sit just below the surface, threatening the fragile stability of the housing market.”