More on foreclosure Numbers: Will March dip be wiped out by spring surge? | STLtoday
More on foreclosure #s: Will March dip be wiped out by spring surge? We shall seeSt. Louis Post-DispatchAs we noted in today’s paper, foreclosure activity in metro St. Louis dipped to a two-year low in the first quarter. But a look under the hood of the new numbers out from RealtyTrac this morning shows the signals are much more mixed.
The number of REOs – that’s homes actually repossessed by the bank – that RealtyTrac recorded here in March was just 299. That’s by far the lowest number since at least 2007, and half as many as we’ve seen in a number of months over the last couple of years. There were only 20 REOs recorded in St. Charles County, and the number in St. Louis County fell from 181 in February to 81 in March.
Here’s the county-by-county breakdown:
March Feb. Auction set Reposs. Auction set Reposs. Bond 0 0 1 0 Calhoun 0 0 0 0 Clinton 0 1 0 5 Jersey 2 1 1 0 Macoupin 2 0 1 1 Madison 4 35 5 91 Monroe 0 6 0 5 Saint Clair 3 72 2 72 Crawford 0 1 0 2 Franklin 2 10 2 10 Jefferson 160 18 127 14 Lincoln 0 6 0 12 Saint Charles 208 20 154 50 Saint Louis 736 81 531 181 Saint Louis City 251 41 191 97 Warren 1 4 0 1 Washington 0 3 0 0 Total 1369 299 1015 541 What’s unclear is how long this will last.
Some analysts say banks are putting off repossessions right now, for a variety of reasons (federal mortgage assistance programs, no desire to try and re-sell houses in this weak real estate market, the sheer backlog of paperwork), but that they’re laying the groundwork by still filing defaults, which start the process.
RealtyTrac doesn’t count default filings in Missouri, so it’s hard to get a read on if that’s happening here (though a separate report out last week found delinquency topping 6 percent). But the number of homes set for auction – that is, given a date for sale – surged in March to its highest level since Oct. 2008. Some of those sales may be put off, or avoided altogether. But that number sets the stage for a rough summer in the foreclosure market.
Now, as always, it’s worth remembering not to read too much into this data, particularly as a short-term indicator. On a month-to-month basis, it can be very volatile, depending on the quirks of how RealtyTrac and various counties count and report their numbers.
But over the long run, it does appear that things are getting better. What’s less clear is how long they’ll stay that way.
Commentary:
Tim asks an interesting question - will we see any increase in foreclosures in Saint Louis as we continue into late spring and summer months. The data, as Tim notes above, is highly volatile month/month. One trend has continued to be very consistent in the Saint Louis market - a very low percentage of the notices of default - are actually sold at auction.
Many St Louis homeowners are able to resolve things with their lender. Others arrange with their lender to complete a short sale and hire an agent to handle the short sale for them. The graphic above shows this trend as well - notably that a much lower line (red) for Repossessed when compared to set for auction. If the graphic included delinquent homeowners the 'gap' would be immense.
Distressed property inventory - short sales and foreclosures - in St Louis continues to be a very minor portion of the overall housing inventory (less than 10%) for the Saint Louis Real Estate Market.
We do agree with Tim that things are improving. The only distressed property category that we see increasing are short sales for homes above $400K - where sellers facing a challenging sales market are finding the opportunity to sell a major challenge - unless they have enough equity to allow for a price on their home that will cause it to sell vs. their competition.
