Foreclosure Inventory Lowest since 2007

Foreclosure activity continues to decline but the change year-over-year in February was minimal, actually smaller than the decrease from January to February, and completed foreclosures remain more than 50 percent higher than before the housing crisis.  CoreLogic said that there were 34,000 completed foreclosures in February compared to 38,000 in February 2015 a decline of 10 percent.  On a month-over-month basis foreclosures declined by 13.9 percent from the revised January 2016 estimate of 39,000 foreclosures. 

As a basis of comparison, before the decline in the housing market in 2007, completed foreclosures averaged 21,000 per month nationwide between 2000 and 2006 but at the peak of foreclosure activity in September 2010 there were 117,776 homes repossessed.  Since 2008 over 6 million homes have been lost to foreclosure.

The foreclosure inventory, homes in process of foreclosure, fell 2.6 percent from January and 23.9 percent from the previous February.  The February inventory included approximately 434,000 homes, 1.1 percent of those with a mortgage.  In February 2015 there were 571,000 homes in foreclosure, a rate of 1.5 percent.  The February inventory rate was the lowest since November 2007.

CoreLogic reports a 19.9 percent decline in serious delinquencies (over 90 days past due and including loans in foreclosure) from February 2015 to February 2016, leaving a delinquency rate of 3.2 percent, the lowest in eight years.  There were 1.3 million delinquent loans at the end of the reporting period.

"Job creation averaged 207,000 during the first two months of 2016, and incomes grew over the past year," said Dr. Frank Nothaft, chief economist for CoreLogic. "More income and improved household finances have helped bring serious delinquency rates down in nearly every state. However, serious delinquency rates increased in North Dakota and West Virginia, two states affected by price declines for the energy fuel each produces."

"Home price gains have clearly been a driving force in building positive equity for homeowners," said Anand Nallathambi, president and CEO of CoreLogic. "Longer term, we anticipate a better balance of supply with demand in many markets which will help sustain healthy and affordable home values into the future."

The five states with the highest number of completed foreclosures for the 12 months ending in February 2016 were Florida (72,000), Michigan (49,000), Texas (29,000), California (25,000) and Ohio (23,000). These five states accounted for almost half of all completed foreclosures nationally.  Foreclosure inventory rates were highest in New Jersey (4.0 percent), New York (3.4 percent), Hawaii (2.3 percent), Florida (2.2 percent) and the District of Columbia (2.2 percent).