US foreclosure rates continued to drop throughout 2019 and a newly released year-end report shows that activity in the foreclosure market actually hit a 15-year low.
Real Estate Market Report: US Foreclosure Rates 2019
ATTOM Data Solutions has shared its Year-End 2019 U.S. Foreclosure Market Report. The report took a look at foreclosure filings on US homes which includes default notices, bank repossessions as well as scheduled auctions. Data shows that in total, filings were reported on 493,066 properties across the US housing market.
This number is down by 21% from 2018. Compared to the height of activity in the foreclosure market in 2010, when there was a reported 2.9 million properties with filings, the 2019 foreclosure rates have dropped by a whopping 83%. ATTOM’s foreclosure data dates back to 2005 and shows that last year had the lowest activity since then.
Foreclosure starts were also down in the US housing market 2019 to 335,985 properties. This was a decline of 9% from 2018 and 84% from 2010- another historic low (data dates back to 2006). However, the rate of foreclosure starts saw an increase in 14 US states.
Looking at the market share for homes with foreclosure filings, these properties made up 0.36% of all US properties. Compared to the year prior which saw a market share of 0.47%, the number has dropped. And naturally, it is down from the peak of 2010 when the foreclosure market share was 2.23%.
It is important to note that December foreclosure data shows that rates actually rose. With foreclosure filings on 53,279 properties, the number increased by 7% from November 2019 and 2% from December 2018.
US States with the Highest Foreclosure Rates
- New Jersey- 0.82%
- Delaware- 0.73%
- Maryland- 0.66%
- Florida- 0.63%
- Illinois- 0.63%.
- Connecticut- 0.53%
- South Carolina- 0.52%
- Ohio- 0.48%
- Nevada- 0.42%
- New York- 0.41%
US Metros with the Highest Foreclosure Rates
From 220 metropolitan statistical areas with a population over 200,000, the following real estate markets had the highest foreclosure rates in 2019:
- Atlantic City, New Jersey- 1.33%
- Trenton, New Jersey- 0.91%
- Jacksonville, Florida- 0.85%
- Rockford, Illinois- 0.82%
- Lakeland, Florida- 0.81%
From metros with a population over 1 million, those leading the nation in foreclosure rates include:
- Philadelphia, Pennsylvania- 0.75%
- Cleveland, Ohio- 0.73%
- Chicago, Illinois- 0.71%
- Baltimore, Maryland- 0.68%
REO Statistics for 2019
REOs (bank repossessions) fell in 2019, with only a reported 143,955 properties repossessed through foreclosure. This was a drop of 37% from the year before and a drop of 86% from 2010 which saw close to 1,050,500 REO properties.
Looking at foreclosure data by state, California and Florida foreclosure rates are still high, with a total of almost 1.5 million REO properties in the last decade. Other states with high REO foreclosure activity include:
- Michigan- 333,312 REOs
- Texas- 323,806 REOs
- Illinois- 312,057 REOs
- Georgia- 304,964 REOs
Even so, REO rates are down in 49 states.
Looking at major US metro areas with a population over 200,000, the report shows that the following real estate markets actually had a year-over-year increase despite the national drop:
- Honolulu, Hawaii- up 34%
- Myrtle Beach, South Carolina- up 28%
- Florence, South Carolina- up 18%
- Buffalo, New York- up 16%
- San Luis Obispo, California- up 9%
What the Drop in Foreclosure Rates Signals for the US Housing Market 2020
Generally, a drop in foreclosure activity is a sign of a healthy real estate market. Todd Teta, chief product officer for ATTOM Data Solutions, says:
The continued decline in distressed properties is one of many signs pointing to a much-improved housing market compared to the bad old days of the Great Recession. That said, there is some reason for concern about the potential for a change in the wrong direction, given that residential foreclosure starts increased in about a third of the nation’s metro housing markets in 2019. Nationally, the number also ticked up a bit in December. While that’s not a major worry, it’s something that should be watched closely in 2020.
With a strong economy, more property owners are able to make payments on their homes, keeping the foreclosure activity down. However, as Teta points out, the 2020 forecast for foreclosures is not yet in and we will have to watch rates closely.
Read the full report here.
In the Market for a Foreclosed Home for Sale?
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