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Foreclosures a Non-Event Now – Activity Hits 15-Year Low

Total 2019 U.S. foreclosure activity – default notices, scheduled auctions and bank repossessions – was down 21% compared with 2018 and 83% from its 2010 peak. 

IRVINE, Calif. – ATTOM Data Solutions’ Year-End 2019 U.S. Foreclosure Market Report finds that foreclosure filings – default notices, scheduled auctions and bank repossessions – were down 21% from 2018 and down 83% from a peak of nearly 2.9 million in 2010. It’s the lowest level of foreclosures since ATTOM began tracking them in 2005.

Bank repossessions alone are down 86% over the same period. Lenders repossessed 143,955 properties through foreclosure (REO) in 2019, but that’s down 37% from 2018 and down 86% from the peak in 2010 for a record low. Still, Florida and California combined have seen more than 1.5 million foreclosures in the past 10 years.

ATTOM’s numbers present mixed messages for Florida and its metros. While foreclosure starts were down statewide, for example, more Orlando homeowners received a first-notice in 2019 than did in 2018 (up 16%).

And Florida, at times the top state in the nation for foreclosures, came in as No. 4 in 2019. New Jersey topped the list followed by Delaware and Maryland. New Jersey has held the top spot since 2015.

Two state metro areas made ATTOM’s “top metro foreclosure rates in 2019” list. Jacksonville came in at No. 3 with a 0.85% foreclosure rate and Lakeland ranked at No. 5 with a 0.81% foreclosure rate. However, when the list is shortened to only those metro areas with a population of at least 1 million people, ATTOM lists Jacksonville as No. 1.

Foreclosure analysis

 “The continued decline in distressed properties is one of many signs pointing to a much-improved housing market compared to the bad old days of the Great Recession,” says Todd Teta, chief product officer for ATTOM Data Solutions. “That said, there is some reason for concern about the potential for a change in the wrong direction, given that residential foreclosure starts increased in about a third of the nation’s metro housing markets in 2019. Nationally, the number also ticked up a bit in December. While that’s not a major worry, it’s something that should be watched closely in 2020.”

“The home-foreclosure rates continued shrinking dramatically across the United in 2019 to a level not seen in 10 years, as the strong economy leaves more people in a position to make their mortgage payments,” adds Ohan Antebian, general manager for ATTOM’s consumer facing business, RealtyTrac. “Completed foreclosures dropped 37% overall, with decreases in all but one state and almost every metro housing market.”

Good time to sell

“With foreclosure inventory down and interest in that inventory up, it’s a good time for sellers with distressed inventory to sell while the sun shines,” says Daren Blomquist, vice president of market economics with Auction.com. “Foreclosure buyers still enjoy sizable discounts below estimated market value due to the distressed nature of foreclosure inventory, but the average sales price for foreclosure auction properties sold through the Auction.com platform rose to a new record high in 2019 even as the rate of sales to third-party buyers increased.”

It took an average 384 days for a property to get through the foreclosure process in the fourth quarter of 2019 – a 1% decline quarter-to-quarter but an increase of 3% year-to-year. Still, Florida didn’t make ATTOM’s top five list of foreclosure-completion states. The top five at the end of 2019 were Hawaii (1,712 days), Indiana (1,629 days), Arizona (1,434 days), Nevada (1,339 days) and Georgia (1,257 days).

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