An analysis of foreclosure-related filings at the metro level by data aggregator RealtyTrac shows new hot spots emerging in cities not generally viewed as bubble markets, including Provo, Utah; Rockford, Ill.; and Lansing, Mich.
All but one of the 20 metro markets tracked by RealtyTrac as having the highest rate of foreclosure-related filings during the third quarter were located in four states where speculation helped drive up prices during the boom: California, Florida, Nevada and Arizona. Those states also accounted for 37 of the 50 markets identified as having the highest foreclosure rates.
But rising unemployment and interest-rate resets on alt-A and pay-option adjustable-rate mortgage (ARM) loans continue to "gradually shift the nation’s foreclosure epicenters" toward areas that avoided the brunt of the first foreclosure wave, said James J. Saccacio, chief executive officer of RealtyTrac, in a press release.
RealtyTrac counted 937,840 foreclosure-related filings during the third quarter, a 5.4 percent boost from the previous quarter and a 22.5 percent increase from a year ago.
Foreclosure-related filings surpassed levels recorded at the same time a year ago in 15 of the 20 markets with the highest foreclosure rates and in 40 of the top 50 markets.
Among the 50 metro areas with the highest rate of foreclosure-related filings, the biggest year-over-year increases were in Boise City-Nampa, Idaho (up 142 percent); Provo-Orem, Utah (up 120 percent) and Salt Lake City, Utah (up 105 percent).
Other metro markets outside of the four boom states experiencing significant year-over-year increases in foreclosure filings included Rockford, Ill. (up 64 percent); Fayetteville-Springdale-Rogers, Ark. (up 53 percent); Lansing-East Lansing Mich. (up 41 percent); and Chicago-Naperville-Joliet Ill.-Ind.-Wis. (up 28 percent). …CONTINUED
RealtyTrac said the actual increase in foreclosure-related filings in Boise City-Nampa and Fayetteville-Springdale-Rogers may not have been as high as reported, as some of the increase could have been due to changes or improvements in the way data in those markets is collected.
But with one foreclosure-related filing for every 57 homes, Boise City-Nampa was well above the national average of one filing per 136 homes — and the only market to make RealtyTrac’s top 20 not located in the boom states of California, Florida, Nevada and Arizona.
Foreclosure-related filings occur when lenders issue a notice of default, schedule a property for auction, or repossess a home. Not all homes that enter the foreclosure process complete it, as some borrowers are able to refinance their debt or negotiate loan modifications or short sales with lenders.
Eleven of the 20 markets with the highest foreclosure rates were located in California: Merced (one filing per 27 homes), Stockton (one in 28 homes), Modesto (one in 30 homes), Riverside-San Bernardino-Ontario (one in 30 homes), Bakersfield (one in 35 homes), Vallejo-Fairfield (one in 35 homes), Sacramento-Arden-Arcade-Roseville (one in 44 homes), Fresno (one in 52 homes), Salinas (one in 55 homes), Visalia-Porterville (one in 56 homes), and San Diego-Carlsbad-San Marcos (one in 61 homes).
Florida accounted for five markets on RealtyTrac’s top 20 list: Cape Coral-Fort Myers (one in 27 homes); Port St. Lucie (one in 38 homes); Orlando-Kissimmee (one in 39 homes), Miami-Fort Lauderdale-Pompano Beach (one in 45 homes), and Lakeland (one in 57 homes).
Two markets in Nevada made the top 20 list: top-ranked Las Vegas-Paradise (one filing for every 20 homes) and Reno-Sparks (one filing for every 37 homes).
In Arizona, RealtyTrac documented one foreclosure-related filing for every 41 homes in the Phoenix-Mesa-Scottsdale area, the 12th-highest rate in the nation.
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