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Foreclosures Are Way Down From 2014—but Still Double Prerecession Rates

Foreclosures Are Way Down From 2014—but Still Double Prerecession Rates

iStock

iStock

Nearly seven years after the 2008 housing collapse threw millions of homeowners into crisis, the foreclosure rate is edging closer to normalcy. In February of this year, according to the CoreLogic National Foreclosure Report released on Tuesday, there were 39,000 completed foreclosures, down from 46,000 reported in February 2014—and a 67% decrease from their peak in September 2010.

For the 12 months ending in February, foreclosure inventory overall dropped 27.3% as more homeowners remain current on their mortgages due to rising employment, higher home values, and buyer demand. Before the collapse, completed foreclosures averaged 21,000 per month nationwide from 2000 to 2006, according to CoreLogic.

Completed foreclosures are houses that were actually lost in the foreclosure process—either taken over by the bank as real estate owned properties or sold at auction.

For instance, the District of Columbia had only 83 completed foreclosures in the 12 months ending February 2015; still, 2.6% of all of the mortgaged homes in DC are considered to be seriously delinquent and in the foreclosure process, according to CoreLogic. That puts DC in line with four states—New Jersey, New York, Florida, and Hawaii—as having the highest foreclosure inventory in the country, the report said.

Despite the improvement in the housing market, foreclosures remain double prerecession rates, Frank Nothaft, chief economist at CoreLogic, said in a statement.

“While the drop in the share of mortgages in foreclosure to 1.4% is a welcome sign of continued recovery in the housing market, the share remains more than double the 0.6% average foreclosure rate that we saw during 2000–2004,” said Nothaft.

The foreclosure inventory dropped year over year in all but two states: Massachusetts and Wyoming. Both states had inventory increases of 0.1%.

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