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N.C. Home Foreclosure Drops in March, But Actions Increase Nationally

Posted April 15, 2008

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— Is North Carolina’s housing market stabilizing? Possibly.

Home foreclosures across the Tar Heel state fell 18.6 percent in March from February totals, according to statistics released Tuesday morning by mortgage information firm RealtyTrac.

However, the news was not nearly as good nationally. Foreclosure notices were up 5 percent from February to 234,685 properties, RealtyTrac reported.

In North Carolina, action was taken against 3,298 properties, or 1 in every 1,222 households. The total was up marginally from March of 2007, rising  1.76 percent.

Foreclosure actions include default notices, auction sale notices and bank repossessions.

RealtyTrac describes itself as "the leading online marketplace for foreclosure properties."

Across the U.S., the onslaught of homes facing foreclosures has yet to ebb.

Bank repossessions skyrocketed last month as more troubled homeowners mailed in their keys and walked away.

It also appears that the worst isn't over: the wave of adjustable-rate loans resetting to higher rates will crest in May and June. That is expected to push more homeowners into default and foreclosure in the third and fourth quarters of this year, according to RealtyTrac.

"Once we're through that batch of loans, the worst will have been worked through the system," said Rick Sharga, RealtyTrac's vice president of marketing.

The number of U.S. homes receiving at least one foreclosure filing jumped 57 percent in March to 234,685, compared with 149,150 properties a year earlier.

The overall foreclosure rate is 5 percent higher than in February, which saw an unexpected month-to-month decline over January. March marked the 27th consecutive month of year-over-year increases in national foreclosure filings.

That meant one in every 538 households received a filing during the month. Forty-four percent were households that slipped into default for the first time, and more than a fifth were homes that banks took back.

Lenders took possession of homes at a sharply higher rate, up 129 percent over last year, as more homeowners relinquished their homes, said Sharga. Banks repossessed 51,393 properties nationwide, many of them without a public foreclosure auction.

"In a lot of cases, banks worked something out with the owner in advance and took back the keys and deed. For a homeowner, it's not as embarrassing and it's a little less of a blemish on their credit record compared [with] a foreclosure," Sharga said.

He estimated that between 750,000 and 1 million bank-owned properties will hit the market this year, or about a quarter of the homes up for sale. In some areas, these properties will continue to slow sales and depress prices further.

Declining home prices and stricter lending requirements have exacerbated the foreclosure environment. Homeowners stuck in unmanageable mortgages aren't able to sell their homes or refinance into cheaper loans before their mortgage payments reset higher.

Nevada clocked in the worst foreclosure rate for the 15th straight month. Last month, one in every 139 households received a foreclosure-related notice, nearly four times the national rate. The number of properties with a filing increased 24 percent over February and 62 percent over the previous March.

California had the second-highest foreclosure rate in the country. One in every 204 California households received a foreclosure-related notice. The state had 64,711 properties facing foreclosure, the most of any state and more than double last year's total.

In Florida, 30,254 homes reported at least one filing, down nearly 7 percent from February, but up 112 percent from the year before.

Rounding out the states with the highest foreclosure rates were Arizona, Colorado, Georgia, Ohio, Michigan, Massachusetts and Maryland.

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  • RocknRollDoctor Apr 15, 2008

    Nope the burst isn't coming...it's here.

  • GoBoSox Apr 15, 2008

    Exactly...1 in 1,222 households...that's it! This has NEVER been the doom and gloom scenario that the media has made it out to be. While I have empathy for that 1 household, I REALLY feel bad for the dozens of others who are trying to sell their homes and are caught in this sluggish market. Sensationalism has led all real estate buyers to believe that the bubble is going to burst and that they should wait to get a good deal. It's going to become a self-fulfilling prophecy. They are nervous that the market is getting weaker, yet they are the ones weakening it. Just buy the house you like and move in. If you are buying it on speculation, you may lose. If you're buying it as a long-term investment, you'll be just fine! There has been no huge run-up in values. Therefore a burst is not coming.

  • JustAName Apr 15, 2008

    "1 in every 1,222 households"

  • RocknRollDoctor Apr 15, 2008

    Fact. Homeownership is not for everyone.

    Realtors and banks have started selling homes like auto dealerships sell cars, by the monthly payments. With too many 1st time home buyers not knowing an ARM from a Fixed, too many SALES people pushing monthly payments, and too many financing options, this was bound to happen.

  • lornadoone Apr 15, 2008

    That's because NC = #1. I love this state.