U.S. foreclosures dropped by 26.4 percent in October compared with a year ago, according to a new report from real estate data and analytics provider CoreLogic. There were 41,000 completed foreclosures in October 2014, compared with 55,000 in October 2013.
On a month-over-month basis, completed foreclosures were down by 34.1 percent from the 62,000 reported in September 2014. Before the decline in the housing market in 2007, completed foreclosures averaged 21,000 per month nationwide between 2000 and 2006.
As of October 2014, the foreclosure inventory across the country totaled approximately 605,000 homes, compared with 875,000 in October 2013, a year-over-year decrease of 30.9 percent and representing 36 consecutive months of year-over-year declines. The foreclosure inventory as of October 2014 made up 1.6 percent of all homes with a mortgage, compared with 2.2 percent in October 2013. On a month-over-month basis, the foreclosure inventory was down 2.1 percent from September 2014. The current foreclosure rate of 1.6 percent is the lowest inventory level since May 2008.
"While there has been a large improvement in the reduction of foreclosure inventory, completed foreclosures remain high and serve as one of the obstacles to new single-family construction," Sam Khater, deputy chief economist for CoreLogic, said in a statement. "Until the flow of completed foreclosures declines to normal levels, new-home construction will not pick up because builders have little incentive to compete with foreclosure stock."
"The foreclosure inventory is less than 2 percent and seriously delinquent loans are trending lower right now," Anand Nallathambi, president and CEO of CoreLogic, added in a statement. "At current rates [of decline], we can expect the foreclosure inventory to slip below 500,000 units during 2015."
All but one state and the District of Columbia posted double-digit declines in foreclosure inventory year over year; West Virginia saw a decline of only 8.9 percent, and the District of Columbia saw a 17.3 percent increase.
Nineteen states showed declines in year-over-year foreclosure inventory of greater than 30 percent, with Florida (-44.9 percent) and Utah (-41.6 percent) experiencing the largest declines.
The five states with the highest foreclosure inventory as a percentage of all mortgaged homes were New Jersey (5.5 percent), Florida (4.1 percent), New York (4.1 percent), Hawaii (2.9 percent) and Maine (2.6 percent). According to CoreLogic, 1.2 percent of Massachusetts homes were in the foreclosure inventory, 24th among all states and the District of Colombia.
