TAMPA, Fla. (WFLA) — Florida, as it did in January, ranked high for foreclosure starts in the United States. The American real estate market remains in a state of fluctuation, with foreclosures increasing almost 200% compared to the year before.
Real estate data curator ATTOM reported the national level of foreclosures had gone up 185% in May, compared to the year before. There were a reported 30,881 properties with foreclosure filings in May. However, it was only a 1% increase from April.
ATTOM reported the foreclosure activity is climbing at a relatively steady pace. In May, Florida had the most foreclosure starts in the U.S. Jacksonville, Miami, and Orlando were among the highest foreclosure rates reported by ATTOM, with Miami in the lead at one foreclosure start for every 2,432 housing units.
“While there’s some volatility in the monthly numbers, foreclosure activity overall is continuing its slow, steady climb back to normal after two years of government intervention led to historically low levels of defaults,” Rick Sharga, executive vice president of market intelligence at ATTOM, said. “But with inflation now at a 41-year high, and runaway prices on necessities like food and gasoline, we may see foreclosure activity ramp up a little faster than most forecasts suggest.”
Amid high inflation and a reportedly volatile real estate market, mortgage lending has “plummeted” according to ATTOM. The company said overall residential lending had fallen 32% year-over-year, the “fastest decline in eight years.” The number of new loans had also gone down, for the fourth quarter in a row, while refinance lending had dropped 22%. Mortgages themselves had reportedly “dipped” by 18%.
ATTOM said only 1.45 million residential loans were turned into new mortgages during the first three months of 2022, a 22% drop compared to the end of 2021. Additionally, the company noted that what they call zombie foreclosures had increased by 13%.
According to ATTOM, a zombie foreclosure is when a property is foreclosed on and simply sits vacant. While the the real estate company said less than 2% of homes in the U.S. sit vacant, the percentage still “represents 1.3 percent, or one in 76 homes, across the nation.”
They reported that the number of vacant homes had gone up in 2022 already, and that quarter-to-quarter, it went up 2.8%. More than 7,500 pre-foreclosure properties reportedly sit vacant.
“The incidence of zombie-foreclosures tends to be higher in cases where the foreclosure process has dragged on for many months and sometimes even for years,” Sharga said. “We’re now seeing properties where the borrower was already in default prior to the government’s moratorium re-enter the foreclosure process, and undoubtedly some of these homes will have been vacated over the past 26 months.”
The states with the most zombie properties, according to ATTOM’s data, are Michigan, Arizona, Georgia, Nevada, and Iowa.
At the same time, ATTOM reported median single-family home prices have increased 17% in the past year, and home-seller profits “remain historically high,” at close to 50% profit.