Economy Watch: Foreclosures Plummet Because of California
- Feb 15, 2013
RealtyTrac reported on Thursday that U.S. foreclosure filings—meaning all default notices, scheduled auctions and bank repossessions—were reported on a bit more than 150,800 residential properties in January. That represents a decrease of 7 percent from the previous month and a drop of 28 percent from January 2012.
The decrease in foreclosure starts nationwide was mostly due to by a sharp drop in California notices of default in January, RealtyTrac explains. California notices were down 62 percent from December and 75 percent from January 2012, to the lowest level since October 2005. The precipitous drop was caused by a new law in California known as the Homeowners Bill of Rights, which extends many of the principles in the national mortgage settlement, including a prohibition on dual tracking and requiring a single point of contact for borrowers facing foreclosure, to all mortgage servicers operating in California.
“For the first time since January 2007, California did not have the most properties with foreclosure filings of any state,” Daren Blomquist, vice president at RealtyTrac, noted in a press statement. “Instead that dubious distinction went to Florida, where January foreclosure activity increased on an annual basis for the 11th time in the last 13 months.”
The incredible shrinking housing inventories
In another bit of housing news, Realtor.com, a National Association of Realtors website operated by Move Inc., said on Thursday that listing inventories nationwide decreased 16.47 percent year-over-year in January, adding more evidence for the proposition that for-sale housing inventories are dwindling. About 1.47 millions were listed in January, less than half of the most recent peak in Sept. 2007 of 3.1 million units.
Also, the median age of inventory was at 108 days, a 9.24 percent decrease since last year, and median list prices are slightly higher, increasing 0.8 percent year-over-year to $187,000, Realtor.com said in its January 2013 Real Estate Trend Data. “If inventories remain low and list prices begin to rise over the next few months, as they did last year, conditions will be ripe for additional markets to appreciate in 2013,” Move Inc. CEO Steve Berkowitz posited in a press statement.
According to the company, its findings point to opportunities in local markets for both buyers and sellers. With inventories at record lows and list prices increasing, Realtor.com says the best sellers markets this year will be Sacramento, San Jose, San Francisco, Phoenix, and Washington, DC. For consumers looking for a competitive edge, Realtor.com’s top buyers markets are Asheville, NC; Peoria, Ill.; Charleston, W. Va; Philadelphia; and Cleveland.
Jobless claims see downtick
The U.S. Department of Labor reported on Thursday that for the week ending Feb. 9, initial claims unemployment claims were 341,000, a decrease of 27,000 from the previous week’s revised figure of 368,000. The more stable four-week moving average was 352,500, an increase of 1,500 from the previous week’s revised average of 351,000.
Wall Street ended the day on Thursday mixed, but really barely moved. The Dow Jones Industrial Average lost a minuscule 9.52 points, or 0.07 percent, and so remains stuck below 14,000. The S&P 500 and the Nasdaq gained a minuscule 0.07 percent and 0.06 percent, respectively.