Foreclosure activity down for 2019, but some signs point to a rebound

Foreclosure activity during 2019 fell 21% from the previous year, but a few indicators show a change in direction could be possible, a report from Attom Data Solutions said.

The 493,066 properties with a foreclosure filling, or 0.36% all U.S. properties, was the lowest since Attom started tracking this information in 2005. In 2018, 624,753 or 0.47% of properties had a foreclosure filing, while at the peak in 2010, there were 2.9 million or 2.23% of properties.

"The continued decline in distressed properties is one of many signs pointing to a much-improved housing market compared to the bad old days of the Great Recession," Todd Teta, chief product officer for Attom, said in a press release. "That said, there is some reason for concern about the potential for a change in the wrong direction, given that residential foreclosure starts increased in about a third of the nation's metro housing markets in 2019."

"Nationally, the number also ticked up a bit in December. While that's not a major worry, it's something that should be watched closely in 2020," he continued.

Lenders repossessed 143,955 properties through foreclosure during 2019. This dropped 37% from 2018 and fell 86% from the peak of 1.05 million in 2010.

In December, lenders took back 13,898 properties through completed foreclosures, down 1% from November, but up 34% from December 2018.

Additionally in December, 53,279 properties had foreclosure filings, up 7% from the prior month and up 2% over December 2018.

During the year, 335,985 started the foreclosure process, down 9% from 2018 and the fewest since 2006, the first year this data became available.

But 14 states posted year-over-year increases, led by Rhode Island, up 54%. Among metropolitan areas with over 1 million population, Baton Rouge, La., was up 43% and Atlanta was up 25%.

States with the highest foreclosure rates in 2019 were New Jersey (0.82%), Delaware (0.73%), Maryland (0.66%), Florida (0.63%) and Illinois (0.63%). New Jersey has held the top spot since 2015.

"The home foreclosure rates continued shrinking dramatically across the U.S. in 2019 to a level not seen in 10 years, as the strong economy leaves more people in a position to make their mortgage payments," said Ohan Antebian, general manager for Attom's consumer facing business, RealtyTrac. "Completed foreclosures dropped 37% overall, with decreases in all but one state and almost every metro housing market.

"As wages rise, interest rates drop, the stock market keeps hitting new highs and the broader economy remains healthy, the factors that lead to foreclosure simply aren't there. While home prices are rising, homeowners can afford them. The drop-off has been so steep that for every 10 completed foreclosures following the housing market crash a decade ago, there now is just one," Antebian said.