In metropolitan cities that have at least 200,000 people, foreclosure activity increased in 125 out of 212 markets in the first half of this year compared to the prior six months, according to RealtyTrac.
Despite this most recent increase, 129 of the cities posted year-over-year decreases in foreclosure activity since the end of June 2011.
Foreclosure starts were the main reason why 59% of the markets saw a rise in foreclosure activity, the Irvine, Calif.-based analytic provider said.
Second quarter foreclosure starts increased from the previous quarter in more than 60% of the areas studied in the midyear metro report from the company.
RealtyTrac said these markets will likely continue to have more foreclosure inventory in the second-half of 2012 because the average foreclosure sales price is increasing on an annual basis. Average foreclosure sale discounts are 15% or higher, and the unsold inventory of REO homes represents a supply of 20 months or fewer.
“Those foreclosure starts are welcome news for prospective buyers and real estate brokers in many local markets where a shortage of aggressively priced inventory has been holding up sales activity,” said Brandon Moore, CEO of RealtyTrac. “Markets with increasing foreclosure starts will likely see more distressed inventory for sale in the form of short sales and bank-owned properties in the second half of the year.”
Seven of the 10 highest foreclosure rates through the midway point of 2012 were located in California. The Golden State also accounted for the top five cities in foreclosure rates, led by Stockton with the top ranking.
Even though foreclosure filings were down 16% from a year ago—and 13% from the previous six months—Stockton still had a total of 6,218 properties with a foreclosure filing through the end of June 2012. One in every 38 housing units were in some stage of foreclosure in Stockton, which is three times greater than the national average.
Four other California cities rounded out the top five behind Stockton in foreclosure rate, with Modesto second, Riverside-San Bernardino third, Vallejo fourth and Merced fifth.
Atlanta was the only top 10 market that experienced an increase in foreclosure activity in the first-half of the year. A total of 46,267 Atlanta homes had a foreclosure filing through the six-month time period, which is 2.14% of all properties there.
