RealtyTrac’s August 2015 U.S. Foreclosure Market Report, released Sept. 16, 2015, shows a total of 109,561 U.S. properties in all stages of foreclosure filings in August, down 12 percent from the previous month and down 6 percent from a year ago. The 6 percent year-over-year decrease in August followed five consecutive months with year-over-year increases.
“Foreclosure starts in August continued to search for a new floor below even pre-recession levels, indicating the housing recovery of the past three years is built on a solid financing foundation,” said Daren Blomquist, vice president at RealtyTrac. “But the continued rise in bank repossessions indicates more batches of bank-owned homes will be rippling through the housing market over the next three to 12 months as lenders list these properties for sale.”
A total of 45,072 U.S. properties started the foreclosure process for the first time in August, down 1 percent from the previous month and down 19 percent from a year ago to the lowest level since November 2005.
“This influx of bank-owned inventory may be good news for an inventory-challenged housing market, but buyers and investors interested in purchasing these bank-owned homes should understand they tend to be lower-value properties in areas where house values have not recovered as quickly and are more likely to have deferred maintenance issues that will need to be addressed,” Blomquist noted. “The average estimated market value of REO properties nationwide is now 33 percent below the average market value of non-distressed properties, and homes that were repossessed in the second quarter of this year on average had been languishing in the foreclosure process for 629 days.”
There were a total of 36,792 U.S. properties repossessed by lenders, closing out the foreclosure process, in August, down 22 percent from previous month but still up 40 percent from a year ago, the sixth consecutive month with REOs increasing on a year-over-year basis.