More discounted homes for sale have entered the market to start the new year, according to RealtyTrac, as the company reports foreclosures increased in January by 1 percent from December.
The report shows slightly more than 260,000 homes were given filing notices last month. Despite the relatively high number of foreclosures, though, the source states filings were down from the same month last year by 17 percent.
"We've now seen three straight months with fewer than 300,000 properties receiving foreclosure filings, following 20 straight months where the total exceeded 300,000," James J. Saccacio, chief executive officer of RealtyTrac, said in the report. "Unfortunately, this is less a sign of a robust housing recovery and more a sign that lenders have become bogged down in reviewing procedures, resubmitting paperwork and formulating legal arguments related to accusations of improper foreclosure processing."
In addition to a hike in foreclosures, the number of default notices increased in the first month of 2011 by 1 percent from one month earlier. However, this figure was also a decline from January 2010 by 27 percent – the 12th consecutive month defaults have dropped year-to-year.
The amount of foreclosure auctions in January was reportedly the lowest since February 2009, as 108,000 foreclosed properties were sold. Also, lenders foreclosed on more than 78,000 homes during the month, up 12 percent from the prior month but down 11 percent from January 2010.
Nevada, Arizona, Michigan, Florida and California topped the list of foreclosures in January, according to the report. For the 49th straight month, Nevada led the nation in foreclosure rate, as banks repossessed 16 percent more homes there than in December. One in 93 Nevada homes was foreclosed on in January – more than five times the national average, the report says.
California had the most foreclosures in the country to begin the new year, as more than 67,000 homes received filings – more than three times higher than any other state. Reportedly, seven of the top 10 markets for filings in January were from California.
Rick Sharga, a spokesman for RealtyTrac, told CNNMoney that he hopes foreclosure activity increases to start the year so the homes-for-sale market can flourish the remainder of the year.
"We expect a spike in the first quarter," he told the source. "If we don't get that, it could mean that the foreclosures are being pushed back even more, and that the time needed for recovery will be prolonged."
According to a report released by Mortgage Monitor, the national foreclosure inventory went up in December, but the number of loan delinquencies in 2010 fell 18 percent from the year before.
The report states the delinquency rate during December was 8.83 percent and the non-current loan rate was 12.98 percent. Florida, Nevada, Mississippi, Georgia and New Jersey had the most delinquencies and foreclosures during the month, says the report.
"The good news is delinquencies are down. The bad news is that a lot of that is just translating into foreclosures," said Herb Blecher, a vice president with Lender Processing Services, which created the report for Mortgage Monitor.
Despite the high number of loan defaults projected to translate into foreclosures, the paper states an upswing in the economy and labor market to end 2010 halted the typical fourth-quarter increase in delinquencies.
