IRVINE, Calif. (1/16/15)--While overall foreclosure activity dropped in December, foreclosure starts, or those homes to begin the foreclosure process, climbed 6% for the month and 14% annually--the second straight month of year-over-year increases, according to the Irvine, Calif.-based RealtyTrac.
Analysts say the recent trend isn't yet cause for concern, however.
"The national pool of distressed mortgages has not increased despite the surge in foreclosure filings," said Andres Carbacho-Burgos, Moody's analyst (Housingwire.com Jan. 15).
The states with the largest increases in foreclosure starts were Massachusetts (323%), New Jersey (262%), Nevada (194%), Missouri (88%) and New York (33%).
"The geographic location of the surge in foreclosure starts is not surprising," Carbacho-Burgos said. "The list of states with increased activity in the last months of 2014 includes those with judicial foreclosure backlogs such as Massachusetts, New Jersey, Pennsylvania and New York.
"Nevada is on the list and is not a judicial state, but still has a substantial pool of seriously delinquent mortgages relative to the years before the housing crisis."
Overall foreclosure filings, which include default notices, scheduled auctions and bank repossessions, fell 18% annually in December, according to RealtyTrac.
Further, the 1.1 million foreclosure filings in 2014 was the lowest annual rate since 2006. During the year, one in 118 houses saw at least one foreclosure filing, the first time since 2006 the foreclosure rate has fallen below 1%.
"The U.S. foreclosure numbers in 2014 show a foreclosure market that is close to finding a floor and stabilizing at a historically normal level," said Daren Blomquist, vice president at RealtyTrac. "But a recent surge in foreclosure starts and scheduled foreclosure auctions in several states in the last few months of 2014 indicate that lenders are gearing up for a spring cleaning of deferred distress in the first half of 2015 in some local markets."