Foreclosures 46% higher in March than a year ago

Stephanie Armour, USA Today
April 16, 2009

The number of homeowners facing foreclosure surged in March as lenders lifted temporary moratoriums and resumed legal actions against delinquent mortgage payers. Foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 341,180 properties in March, 46% more than a year ago and 17% above February's total, RealtyTrac reports today. One in 159 U.S. housing units received at least one foreclosure notice in the first quarter, for a total of 803,459, according to RealtyTrac, which lists foreclosed properties around the country. The sharp increase in foreclosures comes as the Obama administration is launching an effort to help as many as 9 million borrowers avoid foreclosure by modifying their loans or refinancing mortgages. Many lenders put a temporary freeze on foreclosures late last year while the administration prepared its program. Much of March's activity was in new foreclosure actions — bank repossessions fell 3% from February. With most of the moratoriums now lifted, bank repossessions are likely to start rising again. "I think we'll see foreclosures surge through the summer," said Mark Zandi, chief economist at Moody's Economy.com. The increasing number of jobless Americans is likely to accelerate the supply of foreclosures, which in turn will continue to pull down housing prices, economists say. "This report shows that the housing problems are not going away anytime soon," says Joel Naroff of Naroff Economic Advisors. "Supply from foreclosed homes coming on the market will continue to pressure prices through this year."

Highlights of RealtyTrac's report:
•Five states — California, Florida, Arizona, Nevada and Illinois — accounted for almost 60% of the first-quarter foreclosure activity.
•Nevada had the nation's highest state foreclosure rate in the first quarter — more than five times the national average. One in every 27 housing units received a foreclosure filing during the quarter, RealtyTrac reported.
•Arizona had the nation's second-highest state foreclosure rate for the first quarter, with one in 54 housing units receiving a foreclosure filing.
•California posted the nation's third-highest state foreclosure rate, with one in every 58 housing units receiving a foreclosure filing.
In addition to Florida and Illinois, the other states with foreclosure rates ranking among the top 10 in the first quarter were Michigan, Georgia, Idaho, Utah and Oregon.