December Foreclosure Inventory Hits Pre-Crisis Average

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In the month of December, 21,000 U.S. home foreclosures were completed, down 1.9% month over month and down 39.8% from a total of 36,000 in November 2015, according to CoreLogic. The research firm notes that the current foreclosure inventory totals 0.8% of all homes with a mortgage in the United States, down from 1.2% in December of last year.

The December total of 21,000 completed foreclosures is equal to the average number of monthly foreclosures for the first time since the housing market crashed in 2007.

The number of U.S. homes currently in some stage of foreclosure totals approximately 329,000, compared with 467,000 in December 2015. That represents a decline in the national foreclosure inventory of 29.5%.

The four states and the District of Columbia with the largest foreclosed inventory as a percentage of mortgaged properties are New Jersey (2.8%), New York (2.7%), Maine (1.8%), Hawaii (1.7%) and D.C. (1.6%). The five states with the lowest inventories of foreclosed properties are Colorado (0.2%), Arizona (0.3%), California (0.3%), Minnesota (0.3%) and Utah (0.3%).

The five states with the highest number of completed foreclosures in the past 12 months were Florida (45,000), Michigan (30,000), Texas (24,000), Ohio (21,000) and California (19,000). The five with the fewest foreclosures in the prior 12 months through December were North Dakota (182), District of Columbia (254), West Virginia (312), Montana (630) and Alaska (668).

CoreLogic CEO Anand Nallathambi said:

Foreclosure and delinquency trends continue to head in the right direction powered principally by increasing employment levels, stringent underwriting standards and higher home prices over the past few years. We expect to see further declines in delinquency and foreclosure rates in 2017. As the foreclosure inventory diminishes, we must look ahead and tackle tight housing supply and growing affordability issues which are keeping many potential homebuyers, especially first-time buyers, on the sidelines.

Of the 10 largest U.S. metro areas, the foreclosure inventory was highest in the New York area, at 2.5%. The Miami metro area’s foreclosure inventory totaled 2.0%, with the Las Vegas metro and Chicago each at 1.1%. The lowest totals were posted in the San Francisco (0.1%) area and in Denver (0.2%).

A total of 16 states posted year-over-year declines of more than 30% in foreclosure inventory for the month of December. Washington’s foreclosure inventory has fallen 42.1% in the past 12 months, and Florida’s has dropped by 41.1%.

According to CoreLogic, the current foreclosure rate of 0.8% is the same as the June 2007 rate, and the foreclosure inventory has declined every month for the past 62 months. Before the collapse in the housing market in 2007, the average number of foreclosures completed in a month was 21,000.