Fewer foreclosures as US property market continues to improve
There were fewer US foreclosures in July than a year ago, while properties in the foreclosure pipeline also fell as the housing market continued to improve, according to CoreLogic data.
There were 49,000 completed foreclosures, down from a 65,000 in July of last year, CoreLogic said. There were 53,000 foreclosures in June, down from an originally reported 55,000.
Before the housing market's downturn in 2007, completed foreclosures averaged 21,000 per month between 2000 and 2006. Since the financial crisis began in September 2008, there have been about 4.5 million foreclosures.
Foreclosures are completed when a home is either seized by the lender or sold at auction. Over the past year and a half, the housing market has recovered its footing as prices and sales increased, and foreclosures slowed.
A recent spike in borrowing costs, however, has slowed new mortgage applications and demand to refinance existing loans. If that persists, it could result in fewer foreclosure resales.
"If demand is a little bit lower, it might slow down a bit the pace of decline in foreclosure inventories," said Mark Fleming, chief economist for CoreLogic.
"But of all the housing types in demand, stressed assets are a hot commodity and are often bought by cash investors who are less sensitive to mortgage rates."
There were about 949,000 homes in some stage of foreclosure, down from 1.4 million a year ago. That foreclosure inventory represented 2.4 per cent of all mortgaged homes, down from 3.4 percent in July last year.
The five states with the highest foreclosures in the year to July were Florida, California, Michigan, Texas and Georgia, which together accounted for almost half of all foreclosures.