Not surprisingly, gloomy news on the housing front continues. Note that RealtyTrac data overstates the actual number of foreclosures, since it counts each court filing in the foreclosure process, and any foreclosure involves multiple filings. However, comparisons of activity over time are useful indicators.
Note that changes in various states to draw out the foreclosure process also means the increase in filings understates the deterioration in mortgage holder payments. From Bloomberg:
U.S. foreclosure filings increased 71 percent in the third quarter from a year earlier to the highest on record as home prices fell and stricter mortgage standards made it harder for homeowners to sell or refinance, RealtyTrac said.
A total of 765,558 U.S. properties got a default notice, were warned of a pending auction or were foreclosed on in the quarter, the most since records began in January 2005, the Irvine, California-based seller of default data said in a statement today. Filings rose 3 percent from the second quarter and fell 12 percent in September from August as state laws created to keep people in homes slowed the pace of defaults.
“I wouldn’t be surprised to see foreclosures increase as the economy slows down,” Rick Sharga, executive vice president for marketing at RealtyTrac, said in an interview. “The people living paycheck to paycheck are at risk if they lose their jobs. It will cause more people to lose their homes.”…
A new law in California, which accounted for 27 percent of the foreclosure filings in the third quarter, helped slow the process in September as notices of default dropped 51 percent compared with the previous month, RealtyTrac said. In North Carolina, default notices fell 66 percent last month after lawmakers required lenders to give homeowners an additional 45- day notice.
In Massachusetts, filings rose 465 percent in September from August after a law was passed requiring a 90-day notice before foreclosures could proceed, RealtyTrac said.
After a summer lull, defaults “jumped back up close to the level we were seeing earlier in the year,” James Saccacio, chief executive officer of RealtyTrac, said in the statement….
“The length of the recession will depend on how this bleeds over to employment,” he said. The housing bust is the main reason more than 98,000 jobs in Florida and 77,700 in California were lost in the year through August, Brinkmann said.
Six states accounted for more than 60 percent of defaults in the third quarter, led by California with 210,845 foreclosure filings, more than double the amount from a year earlier, according to RealtyTrac. Florida more than doubled its total to 127,306 from the same period a year ago and Arizona almost tripled to 40,419. Ohio, Michigan and Nevada reported third- quarter filings of more than 30,000 each.