Foreclosure Filings and Sales Drop on the West Coast
West Coast foreclosure activity continued to fall in July compared to the previous month, according to the latest report from ForeclosureRadar.
The firm tracks foreclosure activity in Arizona, Nevada, California, Washington and Oregon and found that filings were lower in every state monitored by the company based in the Golden State.
According to the report, Oregon saw the biggest change in notice of defaults issued with 887 in July from 1,229 in June, a 29.1% month-over-month difference. This is the first time since February 2008 that NODs were below 1,000 filings in the state.
Nevada's NOD filings dropped 8.1% from June, and were down 43.4% from July 2010. The state also had the greatest notice of trustee sale filings, the report said, which fell 21% from the prior month and 34.5% year-over-year.
In Arizona, foreclosure trustee sale filings were down to 5,497 properties in July while June had 6,608 foreclosure filings, a change of 16.8%. This represents the fourth straight month of lower foreclosure notices for the state and is approximately half of the total from the same time period last year.
Foreclosure sales giving the properties back to the banks or to third-party investors were down in four out of the five states. Washington, which had a decrease in notice of trustee sale activity at 16.8%, was the exception. The state saw an increase of 50.9% in REO sales from June 2011 and a 43.6% jump in properties sold to third-party investors.
Due to a 49.7% increase in month-over-month foreclosure cancellations, foreclosure sales were far below the rate seen in June for Oregon. Properties sold back to banks were down 34.7% and properties sold to third-party investors fell 17.8% from June 2011.
According to the report, third-party investors resold foreclosures much faster than the banks. In Oregon, it took banks an average of 156 more days to sell its REO inventory than investors. California banks took approximately 104 days longer than third party investors, whereas Arizona and Nevada banks both took an average of 70 additional days to move its inventory compared to third party investors. Washington had the shortest difference, where it took banks only 52 days longer to sell its share of inventory.
“Our statistics clearly show that real estate investors continue to far outperform banks in dealing with distressed properties,” said Sean O'Toole, CEO and founder of ForeclosureRadar. “Yet politicians and bureaucrats are putting pressure on banks to become landlords, which will hurt local economic activity, as fewer properties are made available to local investors, also impacting their Realtors, contractors, and property managers; as well as to home buyers in need of affordable housing.”