U.S. foreclosure activity decreased nine percent this past November from the previous month, according to RealtyTrac’s Foreclosure Market Report. A total of 112,498 properties were reported having default notices, scheduled auctions, and bank repossessions. A little less than half of those properties started the foreclosure process in November while the other half had already begun the process. The number of foreclosure auctions was down sixteen percent from the prior month and total repossessions were down ten percent.
The states with the highest foreclosure rates were Florida (1 in every 462 housing units with a foreclosure filing), New Jersey (1 in every 478), Maryland (1 in every 581), Delaware (1 in every 693), and Utah (1 in every 750).
Florida was the only state, out of the five states with the highest foreclosure rates, to see a monthly decrease in foreclosure activity. Thirteen out of the last fourteen consecutive months Florida has had the highest foreclosure rate in the U.S., yet the state has seen an annual decrease of fifteen percent.
When asked about the Foreclosure Market Report for November 2014, the Vice President of RealtyTrac, Daren Blomquist said, “The housing market is struggling to find the new normal when it comes to a tolerable level of foreclosure activity in this post-Great Recession economy. Finding that new normal requires striking a balance between too much loan risk, which would result in another housing meltdown, and too little risk, which could result in a stunted recovery. Foreclosure rates on 2014-originated loans are actually higher than 2013-originated loans nationwide and in many markets, indicating that lenders are open to a slightly higher level of risk than we’ve seen over the past five years of extremely tight lending standards, but it’s unlikely that lenders will dial up that risk level too quickly going forward given that many are still dealing with working through a lengthy and messy foreclosure process on risky loans from the last loose lending spree.”
Will the U.S. housing market be able to “find the new normal” in foreclosure activity and reach the required balance between too much and too little loan risk? Only time will tell.