The foreclosure market continues on, even though the real estate market across the nation is improving. Home prices are up, delinquencies are down, and more buyers are getting in on the action. This creates a powerful economic engine that builds on itself and provides strong momentum heading into the middle of 2014.
Even though prospects are looking up for the market as a whole, foreclosures are still prevalent. The market is unbalanced, though. According to reports, nearly half of all foreclosures in the United States are found in just five states.
The five states in question are Florida, Michigan, Texas, California, and Georgia, states that have typically led the market in foreclosures over the years. These states have reported strong foreclosure numbers consistently throughout the past seven years, especially Florida.
One notable state missing from the list: New Jersey, which has the highest foreclosure rate in the country, at 8.12 percent of all home loans.
Foreclosures on a whole are decreasing. The market has seen 2.5 years of consecutive decreases in the number of foreclosures hitting the market and entering the process. Currently, foreclosure inventory is only at 15 months, down by four months from 19 months’ worth of supply in 2013. That means inventory would be depleted within 15 months of purchases at today’s sales rates.
Another sign of strength in the market: there are currently 65 mortgages for every foreclosure that is completed, which is better than the 52 mortgages per foreclosure in 2013. It’s also good for the best levels since February 2008, just one year after the beginning of the crisis.
The top locations for foreclosure deals in Florida are in the metro areas, such as Orlando, Daytona Beach, Miami, Jacksonville, and Tampa. Detroit is a hotbed of foreclosures in Michigan, as is Houston in Texas. Atlanta remains high on the list of Georgia foreclosure destinations, and virtually every major metro area in California has its fair share of foreclosures on the docket.
Those looking for steep discounts on affordable properties that have been placed in the foreclosure process should begin with these five states, along with other states like New Jersey, Ohio, Arizona, Nevada, and the like. Since foreclosure rates are so high in all of these states, the chances of finding ideal properties for investment or for primary residences is much higher.