Home foreclosures in key US markets are on the rise again: report

SoFla, LA were among 22 states that increased in first half of 2018; NY, Chicago numbers fell

Jul.July 12, 2018 08:45 AM

Foreclosures are starting to rise (Credit: iStock)

Almost a decade after home foreclosures skyrocketed during the financial crisis, they are starting to rise again in some of the country’s hottest real estate markets. And loosening lending standards may be among the reasons, according to one expert.

Twenty two states posted increases in new foreclosure filings in the first six months of 2018, compared to the same period last year, according to a new report by Attom Data Solutions.

Overall, from January to June, foreclosure starts nationwide fell 8 percent to 191,914, compared to the first half of 2017, according to the report, released Thursday.

The total number of U.S. homes with existing foreclosure filings in the first six months of the year, 362,275, was down about 15 percent from the same period last year. That is defined as default notices, scheduled auctions or bank repossessions. At its peak, there were 1.6 million foreclosure filings nationwide in the first six months 2010.

In Los Angeles, foreclosure starts increased 9 percent on a year-over-year basis — from January to June — and 39 percent on a quarterly basis — from April to June.

South Florida, meanwhile, is also starting to show an uptick in new foreclosure filings, increasing 49 percent on a quarterly basis, but remaining steady year-over-year, according to the report.

The news was better in New York and Chicago’s metro areas, where foreclosure starts declined by 19 percent in Chicago and 18 percent in New York on a year-over-year basis.

Daren Blomquist, with Attom Data Solutions, said the data suggests that foreclosures are rising amid a gradual easing of lending standards that started in 2014.

“We are starting to see some early signs of risks in the current housing boom,” Blomquist said. “The pendulum is starting to swing back toward loose lending.”

On the other hand, he said the data also shows some positive signs. One is that the average amount of time it takes to foreclose on a property is decreasing.

Properties foreclosed in the second quarter of 2018 took an average of 720 days, down from 883 days in the second quarter of 2017. It’s the shortest average foreclosure timeline since the third quarter of 2016. Blomquist said this means that there are “not a bunch of bad loans that are in the foreclosure pipeline.”

Nationwide, 0.27 percent of all housing units, or one in every 370, had a foreclosure filing in the first six months of 2018, according to the report.

Foreclosure activity in the second quarter of 2018 was significantly below pre-recession levels in 121 of the 219 metro areas analyzed in the report. This includes Los Angeles (56 percent below); Chicago (25 percent below); Dallas-Fort Worth (75 percent below); Houston (37 percent below); and Miami (55 percent below).

Related Articles

Matt Rieger and a rendering of Paradise Lake Apartments

Developer scores financing for West Kendall affordable housing project

Wynwood 25 and Wynwood Annex with Jon Paul Perez and Jonathon Yormak (Credit: East End Capital/Related Group)

Related, East End score $136M refi of Wynwood projects

These real estate power players are involved in 2019’s juiciest lawsuits (Credit: Getty Images)

Here are South Florida’s juiciest lawsuits of 2019

Best of TRD 2019 promo

Coming soon: The Real Deal’s Best of 2019

Madison Realty Capital'a Josh Zegen and Fort Partners' Nadim Ashi  

Four Seasons in Fort Lauderdale scores $210M loan

From left: Andrea and Renzo Rosso

Diesel family dishes on Wynwood condo project

Daily Digest Miami

South Florida home sales struggle in October, Cipriani and Terra plan luxury condo

Rendering of Sailboat Bend II

Affordable housing project in downtown Fort Lauderdale lands $27M loan