REOs stalled in 2009 while pre-foreclosures continued to climb
I presented these charts at the REO CON Summit Convention in Anaheim, Calif., this past weekend, and thought they would be worth sharing here as well. (You should see the charts below but let me know if you have any trouble viewing them as we have had some technical difficulties in displaying images recently.)
Using RealtyTrac data, the charts show what REO brokers have experienced somewhat painfully over the past year: the flood of REOs that were predicted to hit in 2009 never really materialized. And that was even while pre-foreclosure notices like Notices of Default and Notices of Sale (scheduling a property for a public foreclosure auction) continued to increase at a rapid rate.
Nationwide, pre-foreclosure notices increased 32 percent from 2008 to 2009, following up on a 28 percent increase from 2007 to 2008, but REO activity increased only 7 percent from 2008 to 2009, after posting a 113 percent increase from 2007 to 2008. The unrealized 2009 REO flood is even more pronounced in California, one of the states hit hardest by the foreclosure problem. REO activity decreased 17 percent from 2008 to 2009 in the state, after posting a 264 percent increase from 2007 to 2008.
So does this mean more folks who fall into foreclosure are finding a way out, or does it mean most REOs are simply being delayed while government programs try to push distressed homeowners into loan modifications or short sales?
