Serious Mortgage Default Rate Falls to a 5-Year Low

NEW YORK ( TheStreet) -- The housing market continues to heal with the number of completed foreclosures declining 29% year-over-year in November, according to the latest data from CoreLogic.

According to the report, there were 46,000 completed foreclosures during November. That is still more than double the normal rate of foreclosures. In the pre-bubble days between 2000 and 2006, foreclosures averaged 21,000 a month.

However, the pace of foreclosures has been declining rapidly. Foreclosures were down 8% from the previous month. About 812,000 homes were in some stage of foreclosure, down 29% from a year earlier.

Completed foreclosures are an indication of the total number of homes actually lost to foreclosure. Since Sept.2008, 4.7 million homes have been lost to foreclosure.

The declining pace of foreclosures has been one of the major factors behind the housing recovery. In the early years following the bust, home prices failed to recover as the market was flooded with foreclosed homes.

There were fears that more homes would eventually wind up in foreclosure. Fears of a large "shadow inventory" of homes also weighed on home prices.

Those concerns have waned over the last couple of years as fewer people defaulted on their loans and banks began to pursue alternatives other than foreclosures such as loan modifications and short sales.

Shadow inventory -- or the number of properties that could eventually wind up in foreclosure -- stood at 1.7 million homes in October, according to CoreLogic's estimate. That is down 26.4% from a year earier and the lowest level since August 2008.

If you liked this article you might like

Housing Stocks Fall as Fed Leaves Rates Unchanged

Housing Data Drives Down Homebuilding Stocks

Strong Housing Numbers Boost Home Construction ETFs

5 ETFs to Buy if You Like Lowe's Fourth-Quarter Earnings