Foreclosures in US climb again and property sales drop as real estate crisis continues
Texas is now leading the real estate crisis in the US with the number of foreclosed properties in the state increasing by 35% in February, according to the latest published figures.
It was the highest monthly gain of any state in the country, according to data from ForeclosureListings.com, an online foreclosure marketplace. It also reveals that several states are creating emergency funds to help the temporarily unemployed from being foreclosed on.
Michigan had the second highest increase at 17.5%, followed by California at 11.9% and Florida at 4.7%. Georgia and Arkansas have seen foreclosures drop by 5.5% and 28.6% respectively.
One in every 418 homes received a foreclosure filing, reaching more than 300,000 for the 12th straight month, according to the report which describes the current situation as ‘bleak’.
Las Vegas led all cities with the most foreclosures in February with more than 3,100 filings, a 29% increase from January. Denver had the second highest foreclosure gains among cities with more than 2,000 filings in February, despite the 5% drop from the month before. The 34% increase in Phoenix pushed that city to the third spot with more than 1,600 filings.
There seems little chance of those foreclosed properties realising a better price as the latest figures from the National Association of Realtors (NAR) shows a further fall in sales of previously owned homes in the US in February.
The industry body said sales fell 0.6% in the month to an annual rate of 5.02 million units, an eight-month and down from 5.05 million the previous month.
February’s fall was the third consecutive month sales had declined and the figures have raised concern that the market may be heading for a double dip in both activity and prices.
‘Some closings were simply postponed by winter storms but buyers couldn’t get out to look at homes in some areas and that should negatively impact near term contract activity,’ said Lawrence Yun, NAR chief economist.
‘Although sales have been higher than year ago levels for eight straight months and home prices are much more stable compared to the past few years, the housing recovery is fragile at the moment,’ he added.
Meanwhile, Treasury Secretary Timothy Geithner said fundamental reform of the property market is needed. ‘The housing finance system clearly cannot continue to operate as it has in the past. Fundamental reform is required with stronger regulation, more effective consumer protections and a clearer role of government with less risk borne by the American taxpayer,’ he said.