Even as Americans suffer rising unemployment, foreclosure rates in three states hit hardest by the housing bust — California, Arizona and Florida — stabilized in June, offering hope that the worst of the real estate crisis is over, according to The Associated Press’ monthly analysis of economic stress in more than 3,100 U.S. counties.
NEW YORK (CNNMoney.com) — The foreclosure plague continued to devastate last month.
There were more than 360,000 properties with foreclosure filings — including default notices, scheduled auctions and bank repossessions — an increase of 7% from June and 32% from July 2008, according to RealtyTrac, an online marketer of foreclosed homes. In fact, one in every 355 U.S. homes had at least one filing during July.
"July marks the third time in the last five months where we’ve seen a new record set for foreclosure activity," said James J. Saccacio, chief executive officer of RealtyTrac. "Despite continued efforts by the federal government and state governments to patch together a safety net for distressed homeowners, we’re seeing significant growth in both the initial notices of default and in the bank repossessions."
Look for these properties to weigh on lender balance sheets and drive prices down in devastated neighborhoods. Sales have been good this summer, but as always, they will taper off in the fall. We’ve seen a second wave of investors out there snapping up properties that won’t appreciate and often won’t have positive cash flow. When their owners walk away, things are only likely to get worse.