IRVINE, CA—Rising foreclosure starts and auctions are responsible for US foreclosure activity increasing 4% in March, reports RealtyTrac. Still, first-quarter foreclosure activity was at its lowest level since second-quarter 2007, according to a report from the firm.
The monthly increase in foreclosure activity was driven by a 7% month-over-month increase in foreclosure starts and a 6% monthly increase in scheduled foreclosure auctions. Lenders repossessed 5% fewer US properties in March than the previous month and 34% fewer than a year ago, down to the lowest level since July 2007, an 80-month low.
“Now that the foreclosure deluge has dried up, banks are turning their attention back to properties that have been sitting in foreclosure limbo for some time,” says Daren Blomquist, VP of RealtyTrac. “This is most evident in judicial-foreclosure states that were more likely to have impediments in the foreclosure process, but there are also signs of this catch-up trend happening in some non-judicial states like California, where an increasing number of judicial foreclosure filings boosted foreclosure starts in the first quarter.”
Blomquist adds that banks will also now be able to devote more resources to dealing with the lingering inventor of nearly half a million already-foreclosed homes that still need to be sold. “Our estimates indicate only 10% of these bank-owned properties are listed for sale, and more than half are still occupied by the former homeowner or tenant.”
As GlobeSt.com reported earlier this month, short sales and distressed sales—defined as those in foreclosure or bank owned—accounted for 16.9% of all US home sales in February, up from 16.1% of sales in January, but down from 19.1% of sales in February 2013, according to a report from RealtyTrac. Experts believe the reduction is in part due to the decreasing amount of distressed inventory in the pipeline.