THREE THINGS TO KNOW
1. Ohio ranked No. 8 among states with the highest rate of foreclosure filings in the July through September quarter.
2. U.S. properties with foreclosure filings fell 5 percent from the previous three months but were up 3 percent from the third quarter of 2014.
3. The annual increase in the third quarter marked the second consecutive quarter in which U.S. foreclosure activity increased on a year-over-year basis following 19 consecutive quarters of year-over-year declines.
Foreclosure activity continues to decline in Ohio, but the still historically high levels of foreclosure filings locally and in other parts of the country reflects a national housing market that hasn’t fully recovered from the crisis that set off the Great Recession more than seven years ago.
The number of Ohio properties with some type of foreclosure filing — such as default notices, scheduled auctions and bank repossessions — fell by about 9 percent in the third quarter, compared to the July-September period a year ago, according to California-based housing analytic firm RealtyTrac Inc. The 15,331 Ohio properties with foreclosure filings in the past three months was also down about 12 percent from the previous quarter.
The good news is Ohio is bucking national trends and most foreclosure activity is not being caused by new homeowners becoming delinquent, according to the RealtyTrac data.
Whereas Ohio saw a decrease in total foreclosure activity compared to a year ago, the country registered a 3 percent increase as a whole.
Most activity seen in Ohio and nationwide is properties working their way through the system and completing the foreclosure process by being repossessed. What led the U.S. market to see an increase year-over-year was due to a 66 percent jump in repossessions.
The bad news is despite declines in activity, enough foreclosed properties in Ohio are still being processed that the state ranks eighth in the country for highest foreclosure activity.
“A flood of deferred distress from the last housing crisis is finally spilling over the legislative and legal dams that have held back some foreclosure activity for years,” said RealtyTrac spokesman Daren Blomquist, in a written statement. “That deferred distress often represents properties with deferred maintenance that will sell at more deeply discounted prices, creating a drag on overall home values.”
Reversing six-year trend
The recent trend marks a stark reversal from the first half of the year, when foreclosure activity across the U.S. fell 13 percent from the previous six months, according to RealtyTrac. The firm also found that Ohio’s numbers for the first half of the year were the lowest they have been since at least the end of 2009.
Ohio led the nation in foreclosure activity at the height of the housing crisis, and the numbers are still high. With one in every 334 households involved in the foreclosure process, Ohio ranks No. 8 among states with the highest foreclosure rates, according to RealtyTrac.
“We’re not back to what I would call a normal market yet, but the (foreclosure) numbers are way down from the crazy numbers we had when the crisis began,” said Kal Mughrabi of Coldwell Banker Heritage Realtors in Springboro.
About 2,900 property owners last quarter received notices of default or notices of sale, or had properties repossessed in the Cincinnati metropolitan – which includes Butler and Warren counties. Activity dropped less than 1 percent from the year before. But similar to Ohio as a whole, most activity was not new; over 900 properties are headed to auction and another 1,172 were repossessed over the last three months, according to RealtyTrac.
Just the number of Cincinnati area properties repossessed between July and September grew 75 percent year-over-year, according to RealtyTrac.
At the worst of the housing crisis in 2008, 2009 or 2010 sales of foreclosed and other distressed homes represented as much as 30 percent to 40 percent of the market and now, it’s less than 15 percent, said Joe Mock, this year’s president of the Cincinnati Area Board of Realtors and a real estate agent for Cutler Real Estate.
“Foreclosures will always have an impact on a specific market. However, the impact that they’re having currently is far less than they were… and have been steadily decreasing in number since 2011,” he said. “It’s a strong market, it has been the entire year I’ve been president. Prices are low — they’re lower than 2005. They’re creeping back up, but at a measured rate.”
“It is a seller’s market because there’s such a low inventory.”
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