Florida’s foreclosure gridlock got a kick start this spring with scheduled auctions in June doubling to more than 9,000 from last year as cases are hastened through the legal system.
The increase, as measured by a RealtyTrac report to be released today, is a signal of the court’s determination to clear aging and undefended cases and means more inventory will soon be available to the home-hungry real estate market. Auctions are typically scheduled when the final foreclosure judgment is made.
June also marked another month of Florida ranking highest in the nation for overall foreclosure activity — a title it has held since September, excluding April. South Florida, which includes Palm Beach, Broward and Miami-Dade counties, ranked first in the country among large urban areas.
But the state’s dubious distinction wasn’t driven in June by newly filed foreclosures, which actually fell 23 percent statewide from last year and 26 percent from May.
Instead, it was the 100 percent increase in scheduled foreclosure auctions from last year and a 14 percent increase in bank repossessions that helped maintain Florida’s status.
RealtyTrac measures three benchmarks in the foreclosure process: the initial filing, the notice of a foreclosure sale or auction and the final repossession.
Illinois posted the second-highest foreclosure rate in the nation in June, followed by Maryland.
In Palm Beach County, the clerk and comptroller’s office recorded 1,001 new foreclosure filings last month, down 6.2 percent from May and 20 percent from the same time last year.
That jibes with a mortgage report released Tuesday that showed a drop in delinquent loans countywide. CoreLogic found 13.6 percent of Palm Beach County mortgages in April were 90 days or more late on payments, down from 17 percent last year. In April 2011, 19 percent of the county’s mortgages were 90 days or more late on payments.
RealtyTrac Vice President Daren Blomquist said this is a good time for banks to ready their foreclosures for resale.
“Given the rising home prices in most of these markets, it is an opportune time for lenders to dispose of these distressed properties, either at the foreclosure auction to a third-party buyer, or by repossessing the property and selling it as a bank-owned home,” he said.
With investors grabbing cheaply priced houses, the lack of inventory has made it difficult for traditional homebuyers.
Realtor Rodney Forbes fears homebuyers may have to lower their expectations if the supply of properties isn’t replenished soon.
“If buyers want to buy while the interest rates are still low, they’ll have to be open to something other than their dream home,” Forbes said. “For people who saw a surplus of ‘move in ready’ homes at low prices for the past two years this may be hard to swallow.”
Top five metro areas nationwide for foreclosure activity in June
South Florida (Palm Beach, Broward and Miami-Dade counties)
Top five states for foreclosure activity in June