Foreclosure is a hot topic among the press lately. It's hard to turn on the television or open up a newspaper without seeing a story about it.
But what's most interesting about foreclosures is that they appear to be concentrated in certain areas of the country.
According to the foreclosure-tracking service RealtyTrac, 4 states accounted for more than half of nation's foreclosures last month.
And those 4 states -- California, Florida, Arizona, and Nevada -- share some very similar characteristics including:
- Their respective popularity with retirees and real estate investors
- Their large home value increases earlier this decade
In looking at the rest of the country's foreclosure data, the remaining 46 states combined accounted for just 48.8 percent of October's foreclosures.
That's 1.06% per state on average.
Now, this isn't meant to diminish the impact of foreclosures on the economy -- quite the opposite. Foreclosures harm to the national housing market because most mortgage lenders are national. But, we highlight statistics like this to show that the foreclosure "problem" isn't so bad in most parts of the country, relative.
Furthermore, mortgage lenders are intervening to slow the flow of defaults nationwide. Following the lead of JP Morgan and Bank of America, CitiMortgage just announced a sweeping plan to help homeowners avoid default and keep their homes.
In a way, for as good as this news is for homeowners, it's equally bad news for home buyers. As the number of foreclosures decrease in any given market, it reduces the inventory of homes for sale. Lower supply levels often lead to higher sale prices and less room to negotiate. And this may be what the banks are trying to accomplish.
Thank you Scott for sharing this...it is good information that I will pass along to my clients.
I could have picked all 4 without looking at the graph. Its obvious it was the ones that went up the fastest when the market was booming.
Ouch!!
This is great information. It is a shame, or should I say shameful, that the news media does not tell this story. They are too busy scaring folks to death that the sky is falling. I am going to share this with everyone I talk with. Thanks again.
I am so glad that New Hampshire is doing so well. Our foreclosure rate isn't even close. I wonder if those stats above are per capita? I only ask because it seems like Ohio and Michigan should have been there but because they are smaller states it seems like that are doing better. But my guess is that these states may even be in the top 4 if the stats were done on a per capita study.
Scott-This is great information, Thanks for sharing with us.
Wow this is a whole new perspective!