More than 2.2 million foreclosure filings on nearly 1.3 million properties. A 75 percent increase in foreclosure activity from 2006. These are the headlines from RealtyTrac's 2007 year-end foreclosure report.
But there's more to the story.
A closer look at fourth-quarter numbers included in the report show slightly divergent trends to close out the year (see charts below). While bank repossessions (REOs) spiked to more than twice the level they were at in the fourth quarter of 2006 and were up 35 percent from the third quarter of 2007, auction and default notices (when the homeowner still has a chance to stop the foreclosure) were actually down 6 percent from the third quarter to the fourth quarter — although they were still up a healthy 75 percent from the fourth quarter of 2006.
Does this mean that banks are giving more leeway to homeowners in distress, working with them to figure out better alternatives to foreclosure? Or it simply representative of a holiday lull in initiating foreclosure activity?
Auction & Default Notices by Quarter
REOs by Quarter
Where the rubber meets the road
All of the above is the view from the 50,000-foot level, but the story is as varied as a patchwork quilt when you start zooming into the county level, as the map below begins to demonstrate. There are certainly foreclosure hot spots in densely populated areas that are helping to drive state and national averages higher, while other areas are maintaining a relatively normal foreclosure rate. Consider that only nine states documented foreclosure rates above the national average for the year: Nevada, Florida, Michigan, California, Colorado, Ohio, Georgia, Arizona and Illinois. View state-by-state stats.
That's not to say there weren't hot spots in other states. Take for example Manassas City, Va., which documented an annual foreclosure rate that was nearly 4.5 times the national average. Or Marion County, Ind., with a foreclosure rate nearly 3.3 times the national average. Or Shelby County, Tenn., with a foreclosure rate 2.7 times the national average.
But there were also plenty of areas with relatively low foreclosure activity, even in states with overall high foreclosure rates. Take Logan County in the heart of downstate Illinois, where foreclosure activity was down nearly 17 percent in 2007. A real estate agent from the town of Lincoln recently called in, bemoaning the fact that national and state foreclosure headlines don't reflect what's happening in her neck of the woods, which she said mostly avoided the risky loans susceptible to foreclosure and where she believes homes are still reasonably priced. Furthermore she believes the headlines of rising foreclosures are contributing to a weakening in her local market that is unfounded.
So we'd like to hear your take on these numbers. What did you see happening in the real estate market in your area in 2007? What is in store for 2008? Give us the good, the bad and the ugly. Just comment below to respond or start a new thread of conversation.
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