Home Repossessions Are Up in Half the States
Florida still leads the country in overall foreclosure activity, but Maryland and Oregon experienced dramatic increases in foreclosure starts in recent months. Meanwhile, bank repossessions climbed significantly in Kentucky and New York.
The number of U.S. homes entering the foreclosure process hit a seven-year low between July and September, but bank repossessions were up 7 percent from the previous quarter, with Kentucky seeing the biggest jump, up nearly 70 percent, new data show.
Even with its sharp increase in repossessions, Kentucky's overall foreclosure rate—which includes default notices, scheduled auctions and bank repossessions—ranked 36th among the states in the third quarter, according to a new data released Thursday (Oct. 10) from RealtyTrac, which follows real estate trends.
Daren Blomquist, vice president at RealtyTrac, figures that that now that Kentucky's housing market is recovering, lenders are finally clearing out some of the properties that started the foreclosure process a year or two ago. “Some of those are finally being foreclosed and repossessed by the banks,” he said.
Nationwide, more than 119,000 properties were repossessed by lenders in the third quarter, putting the nation on pace for close to half a million total bank repossessions for the year, RealtyTrac said.
Nationwide, bank repossessions in the third quarter decreased 24 percent from a year ago. But 26 states experienced an increase in bank repossessions in the third quarter, including New York (up 65 percent), New Jersey (up 64 percent), Illinois (up 44 percent), Virginia (up 36 percent), Connecticut (up 34 percent) and Indiana (up 30 percent) (see graphic).
At the height of the foreclosure crisis in 2010, Nevada led the country with 1 out of every 76 homes in some stage of foreclosure, including default notices, auctions and bank repossessions. Today, Florida leads with a rate of 1 in every 126 housing units — more than twice the national average. Nevada currently is ranked second, with a rate of 1 in every 128 housing units, RealtyTrac said.
Maryland's foreclosure starts increased 259 percent in the third quarter, helping to boost the state's overall foreclosure rate to third highest among the states.
Nationwide, the number of U.S. homes entering the foreclosure process during the July to September quarter totaled more than 174,000, a 13 percent decline from the previous quarter and a 39 percent decrease from a year ago, the lowest level since the second quarter of 2006, RealtyTrac said.
“While foreclosures are clearly becoming fewer and farther between in most markets, the increasing time it takes to foreclose is holding back a more robust and sustainable recovery,” Blomquist said.
It takes longest to foreclose a property in New York, where the average duration is 1,037 days. It takes the shortest amount of time in Maine, where the average is 160 days.