Foreclosures at 40-Month Low

NEW YORK (MainStreet) -- Foreclosure activity decreased by 9 percentage points to a 40-month low in April, according to new data released Thursday by Realty Trac, a firm that monitors the foreclosure market.

In total, 219,258 U.S. properties were in some stage of foreclosure -- including default notices, scheduled auctions and bank repossessions -- with one in every 593 U.S. housing units receiving a foreclosure filing over the course of the month.

In addition to the month-over-month decrease, the numbers represent a 34-percentage point decrease from April 2010.

"This slowdown continues to be largely the result of massive delays in processing foreclosures rather than the result of a housing recovery that is lifting people out of foreclosure," James J. Saccacio, chief executive officer of RealtyTrac said in a written statement.

RealtyTrac said the robo-signing controversy of October 2009 that led to a residual and persistent filing freeze across the nation still had a hand in the http://www.mainstreet.com/article/real-estate/shadow-inventory-hurts-housing artificially low numbers.

However, Rick Sharga, RealtyTrac's senior vice president, added that the current sluggish housing market was also slowing down foreclosure filing procedures.

"Banks will only repossess homes as quickly as they can sell them," Sharga said. "Part of the recovery hinges on whether or not people start buying homes."

Sharga said that the complications could delay any significant recovery in the housing market for the next three to four years. He likened the current state of the market to a vicious cycle, as distressed properties continue to cause home values to remain low and thereby dissuade many from selling their homes and buying new ones.

State by state, Nevada continued to post the nation's highest foreclosure rate for the 52nd straight month, with one in every 97 housing units receiving a foreclosure filing in April. Second was Arizona where one in every housing units entered foreclosure filing in April.

Other states with high foreclosure rates last month include California, Utah, Michigan, Florida, Georgia, Colorado and Oregon.

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