Want an interest-only mortgage? Go to a credit union

NEW YORK – March 10, 2014 – Buyers shunned by major lenders may have better luck checking with their local credit union, some of which have again started offering no-interest mortgage loans.

It’s not a high-risk venture that could lead to another real estate bubble, according to Bob Dorsa, president of the American Credit Union Mortgage Association. “(Credit unions) never got into the negative-amortization loans and any of those goofy teaser rates,” he said in a New York Times article. “They are interested in what’s in the best interest of their members.” That “best interest” includes any loans considered high risk.

Many of the new qualified mortgage (QM) rules impact loans that a bank hopes to sell to Fannie Mae or Freddie Mac. They don’t apply to loans a bank plans to keep in its own portfolio. Since credit unions tend to retain more of their mortgages, they have more flexibility in what they offer.

Since each credit union has its own policies and can change them at anytime, buyers should check what’s currently being offered. But the New York Times cites the following examples:

• Pentagon Federal Credit Union in Alexandria, Va., rolled out a 15/15 adjustable rate mortgage (ARM). Buyers opting for the loan get a lower interest rate than they would with the more common 30-year loan, but it can adjust later – though only once. If an owner is in the house for 15 years, the rate will adjust, but stay at that new level for the remainder the loan’s term.

“This is an excellent opportunity for anybody who doesn’t think they’re going to be in the same house for 15 years,” says Craig Olson, Pentagon’s senior vice president.

The loan qualifies for purchases up to $750,000, and the 15-year adjustment cannot rise higher than 6 percent.

• Pentagon Federal also has a 5/5 ARM – but buyers can opt for an initial rate 1/4-percent higher rate and pick the times they want the rate to reset.

• Redwood Credit Union in California has a 5/5 ARM that adjusts only once every five years. The rates are generally better than a longer-term ARM – and owners have peace of mind for at least a five-year interval between possible changes. The lender says it appeals to a buyer who expects to own the home less than 30 years.

• Navy Federal, with more than 4.5 million members, has rolled out an interest-only loan – a buyer’s monthly payments include only the interest without any of the principal – which has not been common since the mortgage meltdown. Buyers must generally have the ability to pay the full principal and interest payment, however, and, to qualify, have higher incomes than most other buyers.

• Navy Federal also has a “Homebuyer’s Choice Program” that offers buyers 100 percent financing.

Source: The New York Times, Feb. 27, 2014, Lisa Prevost

© 2014 Florida Realtors®

Many renters, landlords don’t understand rental laws

SEATTLE – March 11, 2014 – Demand for rental housing remains strong, but a survey by Zillow finds a lot of confusion over existing rental laws among landlords and tenants.

On average, renters and landlords answered about half of the survey questions incorrectly (47 percent incorrect for renters/50 percent for landlords) when asked about their respective rights and responsibilities.

• 82 percent of renters and 76 percent of landlords lack understanding of laws on security deposits, credit and background checks
• 77 percent of renters and 69 percent of landlords lack understanding of privacy and access rights
• 62 percent of renters and 50 percent of landlords lack understanding of laws on early lease termination

The survey included people who rent the home they live in (renters) and those who own the home they live in and plus one or more additional homes that they lease (landlords).

Renters and landlords alike demonstrated the least amount of knowledge about credit and background checks, security deposits, early lease termination, and privacy and access rights.

Both renters and landlords showed the most knowledge around discriminatory advertising for rentals, responsibility for repairs and maintenance, and requirements for terminating month-to-month agreements.

“It’s concerning that so many renters and landlords are signing a legal contract without fully understanding their basic rights,” says Carey Armstrong, Zillow director of rentals. In doing so, landlords and renters could be setting themselves up for future disputes and legal costs.”

Two major rental misconceptions

Misconception 1: Security deposit laws
Eight-two percent of renters and three-quarters (76 percent) of landlords said they believe the landlord has 60 days after a lease ends to refund a security deposit (or provide an itemized deduction statement and refund the balance).

Truth: In most states security deposits must be returned between 14 and 30 days. In Florida, a landlord that does not intend to impose a claim on the security deposit has 15 days to return it together with interest if otherwise required.

Misconception 2: Early lease termination
Nearly two-thirds of renters (62 percent) and half of landlords (50 percent) said the landlord has the right to terminate a lease in order to rent the home to his or her family member.

Truth: Landlords may not evict a tenant during the term of the lease simply because they would prefer to rent the unit to a friend or family member, or even to someone willing to pay higher rent.

© 2014 Florida Realtors®

Study: Vacation rental owners making more money

AUSTIN, Texas – April 1, 2014 – In industry research from the “HomeAway Vacation Rental Report: Owner Edition,” HomeAway Inc. reports strong performance of its vacation rental owners during the 2013-2014 winter season, and predicts a strong 2014 summer season.

The top vacation markets with the highest traveler demand are, not surprisingly, in Florida, HomeAway says. It claims 39,159 vacation home listings in the Sunshine State.

Bookings and profits

• More than eight in 10 vacation rental owners (84 percent) report that this year’s bookings are about the same or better than the previous year.

• 93 percent of owners says they did not lower rental rates from last winter, and 21 percent of owners raised their rates.

• Owners who say winter is their peak rental season had a 70 percent occupancy rate. In comparison, Smith Travel Research reports that overall U.S. hotel occupancy rates averaged 57.5 percent booked in the fourth quarter of 2013 and 60.2 percent thus far in 2014 1.

• More than half (54 percent) of the owners surveyed who had a mortgage covered at least three quarters of their mortgage payment from renting their home – an increase of nine percent year-over-year from 2012. Additionally, about two-thirds (65 percent) cover at least half of their mortgage payment.

“What stands out to me from this year’s survey the most is not only the consistency we see year-over-year with successful bookings, but those bookings are taking place at gradually higher rental rates each year,” says Brian Sharples, co-founder and chief executive officer of HomeAway.

Vacation rental profits

• On average, HomeAway vacation rental owners charge a weekly rental rate of $1,520 ($217/night) and make their home available to guests for an average 36 weeks each year – an annual rental income of $27,360 for the average owner.

• 65 percent of owners says their goal for renting the vacation home is to “cover some” or “all of my expenses.” A profit is especially important to 19 percent of those owners.

Expenses and time

• The average owner spends $961 per year to market their vacation rental, which includes costs for listing site subscriptions, local print advertising, property manager fees and paid search efforts.

• Assuming an average annual income of $27,360, the cost to market a vacation rental is 3.5 percent of total rental revenue.

• Vacation rental owners spend an average of nine hours per week marketing and managing their vacation rental properties.

“It’s interesting to note just how much profit is made from the work our owners put into their vacation rental operations,” says Sharples. “With ROI as strong as $84 per hour, the efforts you’re putting into the marketing and management of your property reflect in your bottom line.”

Future retirement homes

• 14 percent of respondents purchased their vacation rental as a future retirement home.

• The average buyer age was 47 years – a drop of seven years compared to two years earlier.

• The average age when owners started renting their vacation home was 50 years – the same as in 2013 but six years younger than owners in 2012.

• 65 percent of owners spent more than two weeks in their vacation home over the last year.

Renter attributes

• 59 percent of owners cite the location of their homes in beach communities.

• Guests typically book a vacation rental 90 days before their trip, making March and April the prime summer booking months.

• Currently, more than half (52 percent) of owners have booked 50 percent or more of the upcoming summer season.

Florida rentals

• A few smaller Florida vacation markets have emerged on this summer’s list including, Mexico Beach, Cape San Blas and Cape Canaveral – all favored for families and groups.

This summer’s top growth markets for increases in vacation rentals stretch from coast to coast. Appearing on both the top markets for travelers and for increased vacation rental listings is Cape San Blas, Fla. and Lavallette, N.J., showing a strong rebound from Hurricane Sandy nearly a year-and-a-half ago.

Top 10 markets for overall rental demand

• Mexico Beach, Fla. (Panhandle)
• Cape San Blas, Fla. (Panhandle)

• Lavallette, N.J.
• Cape Canaveral, Fla.
• Moonridge, Calif. (Big Bear)
• Balboa Peninsula, Calif.
• Manteo, N.C. (Outer Banks)
• Cocoa Beach, Fla.
• Point Pleasant Beach, N.J.
• Crested Butte, Colo.

Top 10 markets seeing the greatest increase in rental demand

• Dauphin Island, Ala.
• Moab, Utah
• Cape San Blas, Fla. (Panhandle)
• Winter Park, Colo.
• Bryson City, N.C.
• South Padre Island, Texas
• Lavallette, N.J.
• Carolina Beach, N.C.
• Clearwater Beach, Fla.
• Park City, Utah

Fla. recreational, ranchland transactions down, prices up

LAKELAND, Fla. – April 3, 2014 – The volume of sales transactions for recreational and ranchlands in Florida is down 50 percent over the past year, but the median price per acre is higher, according to statewide 2013 land sales data compiled and reported in the 2014 “Lay of the Land” Market Report.

This and other key facts important to buyers, sellers and developers will be discussed during the Lay of the Land Conference on Friday, April 4, 2014, at the Streamsong Resort in Polk County.

Florida Realtors Research Economist Brad O’Connor will address Florida’s residential real estate market in 2014 as one of the featured speakers.

“Since 2010, we have been compiling and verifying sales of large tracts of Florida land to help buyers, sellers and developers understand their market value,” says Dean Saunders, owner/real estate broker of Coldwell Banker Commercial Saunders Real Estate. “This is the only verified data available to enable smart transactions when it comes to Florida land sales.”
 
The Lay of the Land Conference where the 2014 Market Report will be unveiled is held annually.

“The Lay of the Land Market Report is outstanding,” says Robert Thomas, chair of the Florida Land Council. “It provides concise and accurate information on a broad spectrum of land use and values and is an important and very valuable resource for Florida land owners.”

For more information about the Lay of the Land Conference, visit its website.

© 2014 Florida Realtors® 

U.S. foreclosure inventory down 35% year-to-year

IRVINE, Calif. – CoreLogic released its February 2014 National Foreclosure Report.

“Although there is good news that completed foreclosures are trending lower, the bigger news is the impressive decline in the foreclosure and shadow inventories,” says Dr. Mark Fleming, chief economist for CoreLogic. “Every state has had double-digit, year-over-year declines in foreclosure inventory, which is reflected in the $70 billion decline in the shadow inventory.”

“The stock of seriously delinquent homes and the foreclosure rate are back to levels last seen in the final quarter of 2008,” adds Anand Nallathambi, president and CEO of CoreLogic. “The shadow inventory has also declined year over year for the past three years as the housing market continues to heal, including double-digit declines for the past 16 consecutive months.”

Feb. National Foreclosure Report details

• The U.S. had 43,000 completed foreclosures in February, down from 51,000 in February 2013, for a year-over-year decrease of 15 percent.

• On a month-over-month basis, completed foreclosures decreased 13.1 percent from 50,000 in January.

• National residential shadow inventory – seriously delinquent, in foreclosure or held as REOs by mortgage servicers, but not yet listed on multiple listing services (MLSs) – was 1.7 million homes in January 2014 compared to 2.2 million year-to-year – a decrease of 23 percent.

• In February 2014, about 752,000 U.S. homes were in some stage of foreclosure, known as the foreclosure inventory (not completed foreclosures), compared to 1.2 million in February 2013 – a year-over-year decrease of 35 percent.

• Month-over-month, the foreclosure inventory was down 3.3 percent from January 2014.

• The February foreclosure inventory represented 1.9 percent of all homes with a mortgage, compared to 2.9 percent in February 2013.

• At the end of February, 1.9 million mortgages or 4.9 percent were in serious delinquency, defined as 90 days or more past due, including those loans in foreclosure or real estate owned (REO).

Regional highlights

• The five states with the highest number of completed foreclosures for the 12 months ending February 2014 were Florida (118,000), Michigan (50,000), Texas (39,000), California (37,000) and Georgia (34,000). Altogether, the five states accounted for almost half of the nation’s completed foreclosures.

• The District of Columbia (60 foreclosures), North Dakota (421), Hawaii (519), West Virginia (571) and Wyoming (705) had the lowest number of foreclosures.

• As a percentage of all mortgage homes, Florida ranked second (6 percent) compared to New Jersey (6.2 percent) in total foreclosure inventory, followed by New York (4.7 percent), Maine (3.4 percent) and Connecticut (3.2 percent).

• Wyoming (0.3 percent), Alaska (0.4 percent), North Dakota (0.5 percent), Nebraska (0.5 percent) and Colorado (0.6 percent) had the lowest foreclosure inventory.

Shadow inventory

• As of January, year-over-year inventory of seriously delinquent homes decreased in all states by double digits.

• Twenty-four states had year-over-year declines of at least 20 percent.

• Year-over-year, the shadow inventory is down 22 percent.
 
• For the year ending in January, shadow inventory has decreased at an average monthly rate of 41,000 units.

Florida has 15 percent of the nation’s distressed properties, with an additional four states – California, New York, New Jersey and Illinois – accounting for 42 percent.

© 2014 Florida Realtors® 

New buyer question: Is my data secure?

CHICAGO – April 7, 2014 – The issue of data security is hot in the nation’s capital – from the Data Security and Breach Notification Act of 2013 to the CEO of Target Corp being hauled to The Hill for grilling over his company’s recent security breach. Even the White House is getting involved, shopping around a consumer privacy bill of rights.

But it’s not just Washington. Americans stung by the loss of personal data have started to worry about the private information they give out, and many want to know how a Realtor protects that data from hackers.

During the first Tech Edge event held at the National Association of Realtors® (NAR) headquarters in downtown Chicago, NAR Senior Technology Policy Representative Melanie Wyne says, “Clients today are smart and savvy. They want to know what you’re doing to keep their data safe.”

Real estate professionals need to make sure they secure clients’ drivers license numbers, earnest money checks, HUD1 forms, rental applications, and any mortgage broker/lender information they may have on behalf of their customers.

“You’re responsible for the security of the information that you collect,” says Wyne.

Forty-six states currently have data breach laws on the books. But really, it doesn’t matter what state you live in, Wyne says. If an agent or broker is dealing with a client who lives in Indiana, they need to be sure they’re using that data in a way that complies with Indiana’s laws.

That’s why many in the business community, especially national companies, are for the most part happy to see Washington getting involved, Wyne says. “Industry is asking to be regulated … if you’re a business that is national, you’d rather deal with a national law.”

“I’m going to scare you a little bit… this is an issue that really no one in our industry is paying attention to,” Wyne says. “The good news is that there are tech tools that can help you.”

Wyne suggests employing a data encryption system, which basically “scrambles up your system” so that only someone with a passkey can read it. For those wanting to learn more about encryption, Wyne says do a quick search of lifehacker.com for encryption tools.

Another easy solution is to simply not collect as much data as you do, and only store it for as long as you absolutely need it. Just because there’s a space on the form for it, does it mean it’s necessary? “Think about what you’re collecting and why you’re collecting it,” she says.

Source: Meg White, Realtor® Magazine

© 2014 Florida Realtors® 

U.S. consumer bureau hearing more mortgage gripes

WASHINGTON – April 7, 2014 – An increasing number of complaints filed with the U.S. Consumer Financial Protection Bureau (CFPB) are related to mortgages, the agency says. Thirty-seven percent of 163,700 consumer complaints the CFPB received in 2013 related to mortgages, with the bulk of those complaints about loan modifications, collections or foreclosures, according to a CFPB report.

“The most common type of mortgage complaint involves problems consumers face when they are unable to make payments, such as issues relating to loan modifications, collections, or foreclosures,” according to the report. “Consumers with successfully completed loan modifications have complained that some servicers do not amend derogatory credit reporting accrued by consumers during trial periods – even when documents provided to the consumers by servicers indicated that they would do so.”

Also, the report notes that consumers seeking short sales have submitted complaints to the CFPB that second-lien holders have refused to accept or subordinate in a short sale. Additionally, consumers who did obtain a short sale submitted complaints that their loan accounts had been incorrectly reported as a foreclosure.

The report notes the following breakdown of the mortgage-related complaints the CFPB received in 2013:

″ Consumer problems when they’re unable to pay (loan modification, collection, foreclosure): 59 percent

″ Making payments (loan servicing, payments, escrow accounts): 26 percent

″ Applying for the loan (application, originator, mortgage broker): 8 percent

″ Signing the agreement (settlement process and costs): 4 percent

″ Receiving a credit offer (credit decision/underwriting): 2 percent

″ Other: 1 percent

Source: “CFPB Awash in Mortgage Complaints,” HousingWire (March 31, 2014)

© Copyright 2014 INFORMATION, INC. Bethesda, MD (301) 215-4688

 

Real estate Q&A: Condo fees still due after a foreclosure

FORT LAUDERDALE, Fla. – April 7, 2014 – Question: I went into foreclosure several years ago on my condominium because I was not able to afford the mortgage and condo dues and stopped paying both. About a year ago, I went through a Chapter 7 bankruptcy and moved to a new home I am renting. I recently got a letter from my former association saying I owe money for unpaid dues. Do I? – Les

Answer: Yes. When you borrow money from a lender to buy a home, you sign both a mortgage and a promissory note. The promissory note is your promise to pay the bank back the money you borrowed and the mortgage lien allows the bank to take back the home as payment toward the note if you stop paying.

A typical Chapter 7 bankruptcy will relieve you of paying back the money you borrowed for the home, but it will not disturb the mortgage lien against the property. This means that after the bankruptcy is complete, you still owe the condo dues until your lender finishes the foreclosure action.

While the bankruptcy will have erased all the back payments you owe the association, you still will rack up new payments after the bankruptcy since you still own the property. You also still have all the other responsibilities of ownership, such as property taxes and liability for negligence.

If you are abandoning a property in bankruptcy, you need to make sure the bank takes back ownership as soon as possible to avoid further problems. Talk to your lender about the importance of wrapping up the case quickly – or consider filing a motion with the court to push the case to a conclusion.

About the writer: Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program.

The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.
Copyright © 2014 Sun Sentinel. Distributed by MCT Information Services.

Growing demand for apartments pushing up rents

NEW YORK – April 7, 2014 – These are good times for U.S. landlords. For many tenants, not so much.

With demand for apartments surging, rents are projected to rise for a fifth straight year. Even a pickup in apartment construction is unlikely to provide much relief anytime soon.

That bodes well for building owners and their investors. Yet the landlord-friendly trends will likely further strain the finances of many renters.

A 6 percent rise in apartment rents between 2000 and 2012 has been exacerbated by a 13 percent drop in income among renters nationally over the same period, according to a report from Apartment List, a rental housing website, which used inflation-adjusted figures.

“That’s what we call the affordability gap,” says John Kobs, Apartment List’s chief executive. “I don’t see that improving in the near future.”

Demand for rental housing has grown as the U.S. economy has strengthened since the end of the Great Recession nearly five years ago. Steady job growth has made it possible for more people to move out and rent their own apartments. Yet rising home prices are preventing many from buying.

A combination of rising rents and sluggish pay gains will likely continue to weigh on the U.S. economy, which relies primarily on consumer spending.

The trend is straining the finances of tenants like Michael Strane.

The geologist recently decided to move from Pasadena, California, to the L.A. suburb of Whittier, where asking rents jumped an average of nearly 14 percent last year, according to real estate data provider Zillow.

The location of Strane’s new apartment cut his two-hour commute to work in half. But he’ll be paying $1,045 a month, $200 more than he paid before.

“I’m actually paying more than I really feel comfortable paying right now,” says Strane, 39.

Rental boom

Rental demand has risen in much of the United States since the housing market collapsed in 2007. A cascade of foreclosures forced many people out of their homes and into apartment leases. At the same time, construction of apartments was stalled until the last couple of years because many builders couldn’t get loans during the credit crisis.

Add to that several recent trends, from rising mortgage rates to stagnant pay, which have combined to discourage many people from buying homes. It’s resulted in fewer places to lease and a bump up in rents.

The national vacancy rate for apartments shrank from 8 percent to 4.1 percent from 2009 to 2013, according to commercial real estate data provider Reis Inc.

As a result, landlords were able to raise rents in many markets. The average national effective rent rose 12 percent to $1,083 during those years, according to Reis, which tracked data for apartments in buildings with 40 units or more. Effective rent is what a tenant pays after factoring in landlord concessions, such as a free month at move-in.

Over the same period, the median price of an existing U.S. home has risen about 14 percent, according to data from the National Association of Realtors.

Among major U.S. markets, rents rose the most in Seattle in 2013, up 7.1 percent from the year before, according to Reis. The second-biggest increase, 5.6 percent, was in San Francisco. Nationwide, effective rent rose 3.2 percent last year compared with 2012. Rents rose even as the nation added about 127,000 apartments, the most since 2009, according to Reis. The addition of those apartments hasn’t been enough to absorb the surging demand for rentals.

The Picerne Group is among the apartment complex owners with buildings under construction. The company, which owns properties in California, Arizona, Nevada and Colorado, expects to break ground soon on luxury rental buildings in the Southern California cities of Cerritos and Ontario. The buildings, which have nearly 500 units combined, are due to open next year, says Brad Perozzi, managing director of the company, based in San Juan Capistrano, Calif.

“We definitely see demand improving, especially the younger demographic coming out of college and being in their prime renter years,” Perozzi says. “Even though the single-family home market is coming back, it’s still somewhat cumbersome to obtain a mortgage and come up with a downpayment.”

Jaswinder Bolina knows something about that.

An assistant professor of English at a the University of Miami, Bolina couldn’t afford to pay the roughly $2,000 rent for his two-bedroom, two-bath apartment in an upscale area of Miami and still save enough money for a 20 percent downpayment on a condo.

Ultimately, his parents pitched in, helping him buy a $340,000 condo that he expects to close on in May.

“It could have taken me 10 years to save enough for a downpayment because property values have rebounded out here to the point where I’m priced out of the market,” Bolina says.

Chasing lower rents

Rising rents in San Francisco compelled Marc Caswell to move to Los Angeles in September. He and his girlfriend couldn’t get past the cost of renting a two-bedroom apartment in the San Francisco Bay area, where such housing listed recently on Zillow.com for an average asking rent of $4,100 – more than double what the couple hoped to pay.

“In a year or two, there would have been no money put away,” says Caswell, who works for an environmental nonprofit.

The couple, who earn a combined salary of about $120,000, now pay $2,000 a month for a two-bedroom apartment in Los Angeles, the 12th-most-expensive rental market last year.

Even with more buildings under construction, rising demand will push rents up in many markets. Reis expects a stronger job market to enable more people to start renting their own places instead of living with roommates or parents. As a result, the firm predicts that effective apartment rents will increase 3.3 percent this year to an average of $1,118 nationally.

Good for investors

Higher demand and rising rents, unwelcome as they are for tenants, will produce more income for owners such as apartment REITS. These real estate investment trusts operate buildings they acquire or build.

Steadfast Income REIT, based in Irvine, Calif., is counting on rental growth and demand to continue rising in Texas, Illinois, Kentucky, Oklahoma and the seven other states where it’s invested $1.6 billion to buy buildings with a total of about 16,000 units.

The company has avoided coastal markets, where apartment buildings for sale tend to command high prices, making it harder to turn a profit without charging rents that could price out many tenants. Steadfast likes to buy buildings where it can make money while serving tenants who earn between $45,000 and $75,000. On average, it charges $950 in rent, says Ella Neyland, Steadfast’s president.

Steadfast has 40 percent of its holdings in Texas, where an energy boom is creating jobs faster than the national average. Those jobs are luring people to cities like San Antonio and Houston and driving up demand for rentals.

“Every single day I have some apartment home in my portfolio that’s up for renewal,” Neyland says. “As the market improves, I increase the rents.”
AP Logo Copyright © 2014 The Associated Press, Alex Veiga, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

It’s (almost) official – foreclosure crisis is over

IRVINE, Calif. – Dec. 12, 2013 – RealtyTrac’s Foreclosure Market Report for November shows foreclosure filings – all default notices, scheduled auctions and bank repossessions – decreased 15 percent from the previous month and 37 percent year-to-year.
 
The 15 percent monthly decrease in November was the biggest month-over-month decrease since November 2010 when U.S. foreclosure activity plummeted 21 percent in one month following the revelation of the so-called robo-signing scandal in October 2010.

While the drop reflects all homes somewhere within the foreclosure process, a decline in the number of homes receiving their first foreclosure notice reflects a stronger improvement. A total of 52,826 U.S. properties started the foreclosure process for the first time in November, down 10 percent from the previous month and 32 percent from a year ago, hitting its lowest level since December 2005.

In Florida, the percentage drop in owners receiving a first-time foreclosure notice was also dramatic. The state had 6,744 foreclosure starts in November, an 18.02 percent decline month-to-month and a 45.9 percent drop year-to-year.

The number of Florida foreclosure completions – the final step where a lender takes back the home – also dropped in November, though not as dramatically. Completed state foreclosures were down 2.72 percent month-to-month and 15.59 percent year-to-year.

Florida foreclosure activity in November – starts, in progress and completions – decreased 15 percent from the previous month and 23 percent from a year ago for the fourth consecutive month with an annual decrease. However, the state still has the nation’s highest state foreclosure rate: one in every 392 housing units with a foreclosure filing.

Among metro areas with a population of 200,000 or more, those with the highest foreclosure rates were the Florida cities of Jacksonville, Miami, Port St. Lucie and Palm Bay, along with Rockford, Ill.

“While some of the decrease in November can be attributed to seasonality, the depth and breadth of the decrease provides strong evidence that we are entering the ninth inning of this foreclosure crisis with the outcome all but guaranteed,” says Daren Blomquist, vice president at RealtyTrac.

“While foreclosures will likely continue to stage a weak rally in certain markets next year … it is highly unlikely that there will be a foreclosure comeback that poses any major threat to the solid housing recovery that has now taken hold,” he adds.

Foreclosure Market Report highlights
 
• November foreclosure starts increased from a year ago in 15 states, including Pennsylvania (up 233 percent), Delaware (up 104 percent), Maryland (up 74 percent), Oregon (up 38 percent), and Connecticut (up 37 percent).
 
• There were a total of 30,461 U.S. bank repossessions (REOs) in November, down 19 percent from the previous month and 48 percent from a year ago. It’s the lowest level since July 2007 for a 76-month low.
 
• Only five states posted year-over-year increases in REOs: Delaware (179 percent increase), Maryland (41 percent increase), Connecticut (9 percent increase), Maine (6 percent increase), and Iowa (2 percent increase).
 
• Scheduled foreclosure auctions (which are foreclosure starts in some states) in November increased from a year ago in 19 states, including Oregon (726 percent increase), Massachusetts (217 percent increase), Utah (214 percent increase), Connecticut (199 percent increase), Delaware (104 percent increase), and New York (34 percent increase).
 
• Among the nation’s 20 largest metro areas, those with the highest foreclosure rates were MiamiTampa, Chicago, Riverside-San Bernardino in Southern California, and Baltimore. Only three of the 20 largest metros posted annual increases in foreclosure activity: Baltimore (up 46 percent), Philadelphia (up 34 percent), and Washington, D.C. (up 6 percent).
 
© 2013 Florida Realtors®