American lenders last year initiated foreclosures on the lowest percentage of American homes since 2005, raising hopes that the worst of the last housing crisis might be in the rearview mirror.
The 52,069 properties targeted for foreclosure in December represented a 19 percent drop year over year and the sixth consecutive month of year-over-year-decline after a brief spike in July, according to a report from ATTOM Data Solutions.
In total, about 625,000 homes faced foreclosure in 2018, a fraction of the nearly 2.9 million recorded at the peak of the foreclosure crisis in 2010, the report showed. Overall, lenders initiated foreclosures on 0.47 percent of American homes last year, a 0.4 percentage point decline from 2017 and a 13-year low.
ATTOM tallied default notices, scheduled auctions and bank repossessions to reach its totals.
The “plummeting” numbers are evidence that “most of the distress from the last housing crisis has now been cleaned up,” according to Todd Teta, ATTOM’s chief product officer.
But the numbers didn’t decline in every part of the country. Filings picked up 13 percent last year in Florida, the epicenter of the foreclosure crisis a decade ago. The state registered one of the highest foreclosure rates in the nation in 2018, with about 0.71 percent of homeowners defaulting on their loans.
New Jersey, which has posted the country’s highest foreclosure rate every year since 2015, saw 1.33 percent of homeowners default last year, according to the report. Illinois came in third place at 0.74 percent.
The average foreclosure lasted 811 days during the fourth quarter last year, 216 days shorter year over year, suggesting fewer bad loans were issued during than in previous years. Florida registered the country’s second-longest average foreclosure time during the fourth quarter, at 1,311 days, behind only Hawaii.
The foreclosure numbers are mostly consistent with ATTOM’s mid-2018 report, which found foreclosure numbers dropping in the New York and Chicago metro areas but ramping up in Los Angeles and South Florida, indicating lenders could be loosening their criteria in those markets. Foreclosure activity rose sharply in New York City in 2017, reaching its highest level there since 2009.
Source: The Real Deal Los Angeles