Foreclosure activity fell 5% in November from the month prior, remaining lower than pre-pandemic levels, according to a new report from ATTOM Data.
Foreclosure filings were up 57% YOY due to last year’s moratoriums pushing activity to near zero and pushing data to artificially scary highs.
But activity remains below what ATTOM considers normal levels.
Starts and completions are both up annually as well, by 98% and 64%, respectively, but they too fell month-over-month.
Though starts almost doubled YOY, they are just barely above 80% of pre-pandemic activity.
“We may be at or near a peak level of foreclosure activity for 2022,” said Rick Sharga, executive vice president of market intelligence at ATTOM. “We may continue to see below-normal foreclosure activity, since unemployment rates are still very low, and mortgage delinquency rates are lower than historical averages.”
Sharga also noted that lenders often put a moratorium on foreclosures during the holiday season, which may have influenced the month-over-month downturn.
“While foreclosure starts and foreclosure completions both increased compared to last year’s artificially low levels, they declined from last month, and lenders often put a moratorium on foreclosures during the holiday season,” Sharga said.
Illinois, Delaware, and New Jersey were the states with the highest foreclosure rates.
California, Texas, and Florida once again had the biggest share of foreclosure starts, in particular.
Losing a home is emotionally and financially traumatic, but some analysts argue that foreclosures are important to a robust housing ecosystem.
James Rodriguez recently argued in Business Insider that too few foreclosures indicate that lenders aren’t taking enough risks and are denying too many borrowers.
“Opening the credit box isn’t a cure-all for housing,” he wrote. “But if lenders do it correctly, it could be a major step toward a healthier market. A more stable credit box over time could not only ensure future homebuyers aren’t locked out of getting the home of their dreams, but could also smooth out some of the market’s chaotic nature.”
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