Foreclosure filings were reported on 205,990 U.S. properties in May, an increase of 9% from April and a drop of 4% from May 2011, according to new data from RealtyTrac. May's figures show one in every 639 U.S. housing units with a foreclosure filing.
Foreclosure activity rose back up above the 200,000 level in May, after two consecutive months below 200,000. Foreclosure starts nationwide increased on an annual basis after 27 consecutive months of year-over-year declines. Judicial states combined posted a 26% year-over-year increase in overall foreclosure activity, while nonjudicial states combined posted a 20% year-over-year decrease in foreclosure activity.
Foreclosure starts were filed on 109,051 U.S. properties in May, a 12% increase from April and a 16% increase from May 2011. This is the highest level of foreclosure starts since October 2011.
After three straight monthly decreases to a 49-month low in April, bank repossessions increased 7% on a monthly basis in May. Lenders completed the foreclosure process on 54,844 U.S. properties during the month. However, this is down 18% from May 2011.
Georgia leapfrogged past Arizona, Florida, California and Nevada to post the nation's highest state foreclosure rate in May, the first time since February 2006 that Georgia's foreclosure rate has ranked highest among the states.
‘U.S. foreclosure activity has now decreased on a year-over-basis for 20 straight months including May, but the jump in May foreclosure starts shows that it's going to be a bumpy ride down to the bottom of this foreclosure cycle,’ says Brandon Moore, CEO of RealtyTrac. ‘Based on the rise in pre-foreclosure sales we've seen so far this year, a higher percentage of these new foreclosure starts will likely end up as short sales or auction sales to third parties rather than bank repossessions going forward. While pre-foreclosure sales have less of a negative impact on home values than bank-owned sales, they still represent a discounted sale where a distressed homeowner is losing his or her home.’