Marking more positive signs for housing, foreclosure inventory has fallen over the last year, which will alleviate part of what has made for a tough start to a housing recovery.
Foreclosure inventory falls substantially
According to CoreLogic, there were 56,000 completed foreclosures in the U.S. in December 2012, down from 71,000 in December 2011, marking a 21 percent decrease over the year, and a three percent decrease from revised data for November 2012. In December 2012, approximately 1.2 million homes were in the national foreclosure inventory, down 4.2 from the month prior, and down 19.5 percent compared to December 2011. The current national foreclosure inventory represents 3.0 percent of all homes with a mortgage.
Prior to the housing crash, completed foreclosures averaged 21,000 per month between 2000 and 2006, but since the economic crisis began in September 2008, there have been roughly 4.1 million completed foreclosures in the U.S.
“The most encouraging foreclosure trend reported here is that the inventory of foreclosed properties is almost 20 percent smaller than a year ago,” said Dr. Mark Fleming, chief economist for CoreLogic. “This big improvement indicates we are working toward resolving the backlog of the most distressed assets in the shadow inventory.”
“The rate of foreclosures continues to trend down, albeit at a slower rate as we exit 2012,” said Anand Nallathambi, president and CEO of CoreLogic. “This trend should continue into 2013 and is another positive signal that the gradual healing process in the housing market is gaining traction.”
Regional foreclosure inventory performance varied
The five states with the highest number of completed foreclosures for the 12 months ending in December 2012 were California (100,000), Florida (98,000), Michigan (74,000), Texas (57,000), and Georgia (49,000), and these five states account for almost half of all completed foreclosures nationally.
The five states with the lowest number of completed foreclosures for the 12 months ending in December 2012 were the District of Columbia (89), Hawaii (421), North Dakota (521), Maine (537), and West Virginia (645).
The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were Florida (10.1 percent), New Jersey (7.0 percent), New York (5.1 percent), Nevada (4.7 percent), and Illinois (4.5 percent).
The five states with the lowest foreclosure inventory as a percentage of all mortgaged homes were Wyoming (0.4 percent), Alaska (0.6 percent), North Dakota (0.7 percent), Nebraska (0.8 percent), and Colorado (1.0 percent).