IRVINE, CA—Zombie foreclosures, defined by RealtyTrac as owner-vacated residential properties in the foreclosure process, account for 21% of all active foreclosures, the firm reports. In some areas, zombie foreclosures account for one in every three homes in the process.
As GlobeSt.com had reported earlier this week, foreclosure activity on residential properties continues to decline nationwide, according to a report from RealtyTrac showing that foreclosure filings were reported on 112,498 US properties in February, a 10% decrease from January and down 27% from February 2013 to the lowest monthly total since December 2006. The new figure is a more-than-seven-year low, says the firm.
As of the first quarter of 2014, a total of 152,033 US properties in foreclosure (excluding bank-owned properties) had been vacated by the distressed homeowner. These zombie foreclosures had been in the foreclosure process an average of 1,031 days, according to RealtyTrac.
“The biggest threat from foreclosures going forward is properties that have been lingering n the foreclosure process for years, many of them vacant with neither the distressed homeowner or the foreclosing lender taking responsibility for maintenance and upkeep of the home—or at the very least, facilitating a sale to a new homeowner more likely to perform needed upkeep and maintenance,” says Daren Blomquist, VP of RealtyTrac.
While one in five homes in the foreclosure process are considered zombie foreclosures, in some cities the figure is closer to one in three homes, Blomquist adds. “These properties drag down home values in the surrounding neighborhood and contribute to a climate of uncertainty and low inventory in local housing markets.”