US Foreclosures, Shadow Inventory Decrease

The number of foreclosed homes in the United States in May was 27 percent lower than a year ago, according to the latest numbers from CoreLogic.

 

There were 52,000 completed foreclosures in May, compared to 71,000 in May 2012.  But the levels are still far above the pre-crash foreclosure rate. In comparison, before the market crash the average number of completed foreclosures was 21,000 a month between 2000 and 2006.

"We continue to see a sharp drop in foreclosures around the country and with it a decrease in the size of the shadow inventory," Anand Nallathambi, president of CoreLogic, said in a release. "We are particularly encouraged by the broad-based nature of the housing market recovery so far in 2013."

The data also is good news about the so-called "shadow inventory," homes that are in some level of distress but may not show up in the foreclosure rolls.

As of May there were approximately one million homes in some stage of foreclosure, a 29 percent decrease from the year before, CoreLogic reports. 

Dr. Mark Fleming

"The stock of seriously delinquent homes, which is the main driver of shadow inventory, is at the lowest level since December 2008," Dr. Mark Fleming, chief economist for CoreLogic said. "Over the last year it has decreased in 42 states by double-digit figures, resulting in rapid declines in shadow inventory for the first quarter of 2013."  

Despite rising home prices, consumers are confident in positive trends and affordability, the firm said. 

Even though foreclosures are lower than year-ago levels in May, they were 3.5 percent higher than the previous month. A similar monthly increase was previously reported by RealtyTrac.