Click image to enlargeThanks to a slowdown in the pace of new delinquencies, nationwide shadow inventory declined, according to a report released today by CoreLogic. Shadow inventory dipped to 1.6 million units in July, down from 1.7 million units last measured in April and 1.9 million units a year ago. The current supply represents five months-worth of homes.

Shadow supply, which includes homes that are seriously delinquent, in some stage of foreclosure or are real estate owned, comprises 29 percent of the total July inventory of 5.4 million. Last year at this time the total visible and shadow supply was 6.1 million units. – Adam Fusfeld [more]

Foreclosures appear to be following a “double-peak” pattern mirroring the double-dip pattern housing prices experienced, according to CNBC. Housing prices, as has been widely reported, plummetted at the outset of the recession but rallied briefly thanks to the homebuyer tax credit. Once it expired last year, all the gains were nullified, a recent report from Clear Capital shows.

Now, foreclosures, which spiked during the recession, but slowed in the last year thanks to an elongated process spurred by the “robo-signing” scandal, appear to be picking up again. Foreclosures are up 10 percent in June from May, according to Lender Process Services. [more]

The following chart from commercial real estate analytics firm Trepp shows the delinquency rates for New York City commercial mortgage-backed securities. The chart represents delinquencies overall and by property type between January 2008 and April 2011, both including and excluding the $3 billion loan for Stuyvesant Town and Peter Cooper Village. TRD

Click to enlarge (source: Trepp)

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Commercial mortgage-backed securities loans are showing unusually high delinquency rates, according to the Mortgage Bankers Association, which noted that third-quarter delinquencies in that class of loans reached 8.58 percent — their highest level in more than 10 years. But other commercial and multi-family loans showed improvement in the third quarter, according to the MBA, with delinquency rates on loans held by Fannie Mae and Freddie Mac both below 1 percent. TRD [more]

Delinquency uptick driven by Pinnacle-Praedium default on Upper West Side

The volume of seriously impaired CMBS loans in New York City grew by 3.8 percent last month after a portfolio of 1,083 Upper West Side apartments co-owned by Pinnacle Group and private equity partner the Praedium Group slipped further into delinquency, according to October data from Trepp compiled for The Real Deal. The data includes CMBS loans backed by New York City properties whose payments are more than 60 days overdue. The Pinnacle-Praedium delinquency — the fourth-largest of 49 such loans in the city — was solely responsible for the increase, which put the city’s total volume of loans more than 60 days delinquent at $4.9 billion (see the full list of seriously delinquent New York City CMBS loans after the jump).

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Click image for larger version (source: MBA)

Average New York state delinquencies on one- to four-unit residential mortgages hit 8.8 percent in the second quarter this year, according to the Mortgage Bankers Association’s national delinquency survey (see the full report below). Of those delinquent loans, more than half were seriously in default — more than 90 days past due. But newly delinquent loans also made a significant showing in the second quarter, with 3.17 percent of all loans calculated just 30 days behind in payment. New York’s delinquencies, however, were below the rest of the country’s, according to the report. Nationwide, the total delinquency rate was around 9.85 percent during the second quarter, down 21 basis points from the first quarter of the year, when the rate was 10.06 percent. The delinquency rate actually climbed .61 percent compared to the second quarter of 2009. TRD

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The delinquency rate in New York state increased 73 basis points between the second and third quarters of the year, the overall percentage delinquencies was at 8.84 percent, according to seasonally-adjusted data from the Mortgage Bankers Association, released today. Nationwide, delinquencies on residential loans hit record-breaking levels in the third quarter this year. The delinquency for mortgages on U.S. residential properties with one-to-four units hit 9.64 percent in the quarter, according to the MBA. The figure is 265 basis points up from the same time period last year and up 40 points from the second quarter this year. The record had been set last quarter, when the delinquency rate was at 8.86 percent, but MBA experts said that prime and FHA loans, coupled with continued job losses nationwide, spurred delinquencies. “Despite the recession ending in mid-summer, the decline in mortgage performance continues,” Jay Brinkmann, chief economist with MBA, said. “Job losses continue to increase and drive up delinquencies and foreclosures because mortgages are paid with paychecks, not percentage point increases in GDP.” TRD

U.S. commercial mortgage-backed securities saw another monthly jump in the rate of delinquencies in October, according to data from Fitch Ratings, with Larry Gluck’s $225 million loan, collateralized by the Riverton Apartments in Harlem, clocking in as the largest newly delinquent loan, even though it was transferred to a special servicer over a year ago. Gluck, however was not alone. Late-pays on all CMBS jumped 3.86 percent since September. Office properties saw the biggest jump in delinquencies out of the different types of commercial properties tracked, with 19.4 percent more recorded in October than the month before. Overall, hotel properties saw the greatest percentage of mortgage defaults, with 6.81 percent of hotel property loans going into default, according to the report. TRD
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From the November issue: The new tax rules handed down by the Treasury Department in mid-September are prompting more lenders to employ already-popular “extend and pretend” and “delay and pray” strategies. These darkly comic catchphrases, of course, are used to describe the practice of extending the maturity on troubled loans rather than working out a deal that would reveal just how little the debt is now worth. Those who follow commercial real estate say the federal government’s new regulations — which were designed to help facilitate the modification process for troubled securitized loans — give loan servicers greater leeway to extend loans. Attorneys and advisors with experience working on troubled loans say they have seen a big increase in “extend and pretend” transactions this year across various asset classes. They forecast more such deals, thanks to two favorable trends — the new accounting rules and low interest rates. “Our view is that this condition [of rampant extensions] is going to continue for a while — the alternative is for lenders to decide they have to recognize losses,” said Paul Fried, managing director at advisory firm Traxi.