New findings show foreclosure problems continue to plague the nation’s 100 largest metro areas. The share of loans in foreclosure plus loans delinquent 90 days or more increased from 9.2% in June 2011 to 9.7% in December 2011 after declines that persisted for over six quarters.
According to Foreclosure-Response.org, the rate of the so-called serious mortgage delinquency in the metropolitan U.S. is climbing back from June 2011 lows while the 90-day-plus delinquency rate remained relatively flat at 3.8%, roughly where it has remained for the past four quarters, the share of homes in foreclosure continues to rise, and has now reached to 5.9%.
It remains to be seen whether the rate will stabilize or return to its national peak from December 2009 of 10.5%, analysts wrote.
Data show the average rate for all 366 metro areas has been following the same pattern mainly due to “a buildup of foreclosed homes,” especially in states with a judicial foreclosure process.
The average foreclosure rate in metros in judicial foreclosure states was at 7.2% in December 2011, compared to 4.7% in metros in states without a judicial foreclosure process.
The report states that following expectations foreclosure rates in judicial areas have increased every quarter since March 2009, when Foreclosure-Response.org began tracking the data, while foreclosure rates in nonjudicial metros have remained roughly flat for the last five quarters.
Up to 46 of the 100 largest U.S. metro areas are located in states with a judicial foreclosure process where the foreclosure backlog is mounting. Most problem metro areas are in New York, the state with the longest average foreclosure process, followed by Florida and Ohio.
In Florida—a state that both has a judicial foreclosure process and was hit extremely hard by the foreclosure crisis—the foreclosure rate has grown at a much faster pace. While the national foreclosure rate in the top 100 metros grew by 1.8 percentage points during the March 2009 to December 2011 period. Over the same period foreclosure rates increased by over 5 percentage points In Miami, Orlando and Jacksonville.
Analysts note, however, that being in a nonjudicial state does not guarantee a low rate of foreclosures and over 90-day delinquencies. Data show a number of problematic metro areas, such as Memphis, Las Vegas and several cities in California’s Central Valley, also have high levels of serious delinquencies, “perhaps reflecting continued economic challenges as well as temporary foreclosure delays.”
According to the report, the rebound in the serious delinquency rate reflects a steady increase in the foreclosure rate over the past three years to 5.9% in December 2011 while the 90-day-plus delinquency rate has leveled-off at 3.8%.
