The number of mortgages that were ‘seriously delinquent‘ in November fell to the lowest level since the end of 2008, according to a new data from property information firm CoreLogic. Completed foreclosures also dropped, an indication that the U.S. housing market is getting back on stable footing.
In November there were less than 2 million mortgage loans that were classed as seriously delinquent – those that were late by 90 days or more – accounting for roughly 5 percent of all mortgages, the lowest rate in five years.
At the same time, there were 46,000 completed foreclosures, an 8.3 percent decline from October’s 50,000 and a 29 percent drop from the previous year when there were 64,000. As positive as November’s improvement was, it is still more double the average before the mortgage meltdown in 2007. Between 2000 and 2006 the monthly average for completed foreclosures was just 21,000.
Foreclosures are not spread out equally across the nation. Just a few states continue to account for a large share. During the 12 months ended in November 2013 Florida contributed 115,000 foreclosures, Michigan had 54,000, California had 42,000, Texas had 40,000 and Georgia added 36,000. Together they made up half of the country’s foreclosures in the past year.
CoreLogic also tracks ‘shadow inventory’ – homes that are seriously delinquent, in the foreclosure process or held by banks but not yet listed for sale. There were 1.7 million properties in the shadow inventory as of November. That represents a 24 percent decrease from the year before. Shadow inventory is typically used as a predictor of future foreclosures.
“Nationally, loan performance continues to improve. The rate of seriously delinquent loans is at a new five-year low, down 26 percent relative to a year ago,” said Dr. Mark Fleming, chief economist for CoreLogic in a statement. “The shadow inventory continues to decline as well, decreasing at an average monthly rate of 46,000 units over the last year. Healthy market levels of shadow inventory are around 650,000 units, so there is more to be done, but the trend is in the right direction.”