The Foreclosure Report - May 2011

Third party investors resold the homes they previously purchased at auction at a faster pace throughout our coverage area. As the most sophisticated and motivated homesellers in the marketplace, these investors provide an important indicator as to the health of the entire housing market. While the statistic is encouraging, it's too early to tell whether it is a turning point from the otherwise recent downward trend within the housing market.

Foreclosure filing activity was down in May 2011, with fewer foreclosure filings in all states except California, where there was an increase in Notice of Trustee Sale filings. This increase may lead to more foreclosure sales in future months. Activity on the courthouse steps was mixed, with California the only state to have increases in foreclosure sales both Back to Bank and Sold to 3rd Party. After a jump in foreclosure cancellations across the board in April 2011, there was a reversal of this trend in May, with cancellations dropping significantly in California, Nevada, and Washington. Cancellations moderately declined in Arizona, and increased in Oregon.

"The slowing foreclosure process has left fewer affordable homes available for sale" says Sean O'Toole, CEO and Founder of ForeclosureRadar. "Foreclosure investors may be the only winner so far, benefiting by being able to resell homes purchased at foreclosure auction a little more quickly."

Arizona
Notice of Trustee Sale filings were down 6.6 percent in May 2011 from the prior month and dropped 34.3 percent year-over-year, continuing the downward trend seen over the past several months. Foreclosure sales were mixed with a 9.5 percent drop in sales Back to Bank in May which followed a 22.2 percent decline the month before. Conversely, foreclosure Sold to 3rd Parties, lead by investors, picked up with a 4.7 percent month-over-month increase. Fewer sales Back to Bank contributed to a moderate 2.1 percent drop in Bank Owned (REO) inventory.
View all Arizona stats by state, county, city or ZIP

California
Notice of Default filings fell in May 2011 with a 4.0 percent drop resulting in the fewest foreclosure starts since October 2008 when SB 1137 resulted in a temporary halt in the Notice of Default process. More foreclosures were scheduled for sale at the courthouse steps in May with Notice of Trustee Sale filings up 16.6 percent from April, the first month-over-month increase this year. Notice of Trustee sales remain down year-over-year off by 9.0 percent. Cancellations of foreclosure sales dropped 24.3 percent compared to April after jumping 27.0 percent from March. Foreclosure sales on the courthouse steps were up from the prior month, with 3.4 percent more sales Back to Bank and a 4.1 percent increase in foreclosed properties Sold to 3rd Parties. The average Time to Foreclose continued a steady climb, increasing 10.3 percent to a new record of 344 days. Third parties are reselling inventory more quickly, with the Time to Resell down 7.6 percent month-over-month to 134 days, the fewest number of days since September 2010 — likely due in part to a lack of inventory throughout much of California.
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Nevada
Foreclosure filings were down once again in Nevada, with Notice of Default filings decreasing 13.6 percent in May from the prior month, and reaching the lowest level since our tracking of Nevada foreclosure filings began in August 2009. Notice of Trustee Sale filings fell more moderately, down 3.2 percent month-over-month. Activity slowed on the courthouse steps, with sales Back to Bank down by 8.2 percent, and those Sold to 3rd Parties off by 19.7 percent from April. Sales to 3rd Parties were still well above last year, up 55.1 percent from May 2010. Cancellations dropped 35.2 percent in May from the prior month, to the lowest level this year.
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Oregon
Oregon saw a 52.3 percent drop in Notices of Default filings in May 2011 bringing foreclosure starts down to more typical levels, after filings jumped last month when ReconTrust, a subsidiary of Bank of America, temporarily increased filings. Properties sold Back to Bank rose 22 percent month-over-month, but remain down 45.3 percent from a year ago. Properties Sold to 3rd Parties decreased 16.3 percent month-over-month.
View all Oregon stats by state, county, city or ZIP

Washington
Washington saw a 7.5 percent drop in Notice of Trustee Sale filings from April, the second consecutive month of declines. Foreclosure auction activity also dropped at the courthouse steps, with properties sold Back to Bank down 11.2 percent, and those Sold to 3rd Parties down 24.5 percent from April.
View all Washington stats by state, county, city or ZIP

State	Notice of Default	Notice of Sale	Back to Bank	Sold to 3rd Party
Arizona	n/a	- 6.6%	- 9.5%	+ 4.7%
California	- 24.3%	+ 16.6%	+ 3.4%	+ 4.1%
Nevada	- 13.6%	- 3.2%	- 8.2%	- 19.7%
Oregon	- 52.3%	n/a	+ 22%	- 16.3%
Washington	n/a	- 7.5%	- 11.2%	- 24.5%