US Foreclosures, Shadow Inventory Decrease

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The number of foreclosed homes in the United States in May was 27 percent lower than a year ago, according to the latest numbers from CoreLogic. 

There were 52,000 completed foreclosures in May, compared to 71,000 in May 2012.  But the levels are still far above the pre-crash foreclosure rate. In comparison, before the market crash the average number of completed foreclosures was 21,000 a month between 2000 and 2006.

"We continue to see a sharp drop in foreclosures around the country and with it a decrease in the size of the shadow inventory," Anand Nallathambi, president of CoreLogic, said in a release. "We are particularly encouraged by the broad-based nature of the housing market recovery so far in 2013."

The data also is good news about the so-called "shadow inventory," homes that are in some level of distress but may not show up in the foreclosure rolls.

As of May there were approximately one million homes in some stage of foreclosure, a 29 percent decrease from the year before, CoreLogic reports.

"The stock of seriously delinquent homes, which is the main driver of shadow inventory, is at the lowest level since December 2008," Dr. Mark Fleming, chief economist for CoreLogic said. "Over the last year it has decreased in 42 states by double-digit figures, resulting in rapid declines in shadow inventory for the first quarter of 2013." 

Despite rising home prices, consumers are confident in positive trends and affordability, the firm said.

Even though foreclosures are lower than year-ago levels in May, they were 3.5 percent higher than the previous month. A similar monthly increase was previously reported by RealtyTrac.


Foreclosure Highlights:

• The five states with the highest number of completed foreclosures for the 12 months ending in May 2013 were: Florida (103,000),California (76,000), Michigan (64,000), Texas (51,000) and Georgia (47,000).These five states account for almost half of all completed foreclosures nationally.

• The five states with the lowest number of completed foreclosures for the 12 months ending in May 2013 were: District of Columbia (108), Hawaii (453), North Dakota (467), West Virginia (517) and Maine (644).

• The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were: Florida (8.8 percent), New Jersey (6.0 percent), New York (4.8 percent), Maine (4.1 percent) and Connecticut (4.1 percent).

• The five states with the lowest foreclosure inventory as a percentage of all mortgaged homes were: Wyoming (0.5 percent), Alaska (0.6 percent), North Dakota (0.6 percent), Nebraska (0.8 percent) and Virginia (0.8 percent).

Shadow Inventory Highlights:

• As of April 2013, shadow inventory was under 2 million properties, or 5.3 months' supply, and represented 85 percent of the 2.3 million properties currently seriously delinquent, in foreclosure or REO.

• Of the less than 2 million properties currently in the shadow inventory (Figures 1 and 2), 890,000 properties are seriously delinquent (2.4 months' supply), 761,000 are in some stage of foreclosure (2 months' supply) and 336,000 are already in REO (0.9 months' supply).

• The value of shadow inventory was $314 billion as of April 2013, down from $386 billion in April 2012 and down from $320 billion six months prior, in October 2012.

Judicial Foreclosure States Foreclosure Ranking (Ranked by Completed Foreclosures):