TOPICS > Economy

Number of Homes Headed to Foreclosure Doubles

BY Admin  April 29, 2008 at 10:00 AM EDT

Bank-owned home in Las Vegas, Nev.; AP photo

Foreclosure filings are up in all but four states, and weakening property values and tighter lending have left many homeowners powerless to prevent homes from being auctioned to the highest bidder. Among the hardest-hit states are Nevada, Florida and California.

The research firm RealtyTrac says the latest tally represents an increase of 23 percent from the fourth quarter of last year. Foreclosure increased on an annual basis in 46 states and in 90 of the 100 largest metropolitan areas, to a total of 649,917 properties.

“In most of the states with the highest levels of foreclosure activity, we’re still seeing the fallout from overheated home prices and people overextending themselves with risky loans to try to buy those properties,” Rick Sharga, vice president of marketing at RealtyTrac, told Reuters.

“I’m more convinced that we haven’t seen the peak of foreclosure activity yet, and the wave probably won’t crest until late third or fourth quarter of 2008,” he added.

One of every 194 households received a notice of default, auction sale or bank repossession between January and March, for the seventh straight quarter of rising foreclosure activity, RealtyTrac said.

The study came a day after a U.S. Census Bureau announcement showing the share of vacant U.S. homes grew to a record high in the first quarter. The percentage of owner-occupied homes sitting empty rose to 2.9 percent, the third straight monthly rise, for a total of 18.6 million vacancies.

A closely watched index showed Tuesday that U.S. home prices fell by 12.7 percent in February versus last year, with 17 of the 20 metro areas reporting record annual declines, according to the Associated Press.

The Standard & Poor’s/Case-Shiller home price index of 20 cities also showed Tuesday that home values in 10 cities plunged by double digits, led by Las Vegas and Miami. Only Charlotte,
N.C., posted a positive return year-over-year. All 20 metro areas have declined for six straight months.

Hope Now, a Bush administration-organized mortgage industry group, said nearly 503,000 homeowners had received mortgage aid in the first quarter. Most of the aid was temporary, however.

President Bush planned to talk about U.S. economic problems in a news conference Tuesday morning in the Rose Garden.