Foreclosure activity ticks down slightly in April

Market Trend

Foreclosure activity ticks down slightly in April

Foreclosure activity dipped slightly in April, as the United States continues to see a highly elevated level of foreclosures compared to 2021.

A total of 30,674 U.S. properties filed for foreclosure default notices, scheduled auctions or bank repossessions during April, according to a report from Attom Data Solutions. That figure is down eight percent from March, but up 160 percent from a year ago following the expiration of foreclosure and eviction moratoriums.

The slight dip in April comes as the first quarter of 2022 saw foreclosure activity hit a post-pandemic high, with March 2022 marking the 11th straight month of foreclosure activity increasing on an annual basis, according to Attom.

Foreclosure completions saw the most dramatic decrease of the month, dropping 36 percentage points, with lenders repossessing 2,830 properties in April, which was still up 82 percent from April 2021.

Foreclosure starts meanwhile were flat between March and April, with lenders starting the foreclosure process on 22,286 properties in April, just down negligibly from March when they were at 22,360. Year- over-year, however, starts were up 251 percent according to Attom.

The disparity between foreclosure starts and completion could mark the start of a trend spurred by increased homeowner equity providing assistance to financially distressed owners, according to Rick Sharga, executive vice president of market intelligence for Attom.

“The extreme difference between foreclosure starts and foreclosure completions in April might be the beginning of a trend,” Sharga said. “Record levels of homeowner equity should provide financially distressed homeowners the opportunity to sell their homes prior to a foreclosure auction, meaning we should continue to see fewer foreclosure completions. While it may take several months to determine if this is actually what’s happening, it seems like a real possibility in today’s low supply/high demand housing market.”

Homeowner equity hit a record $9.1 trillion last year as home values skyrocketed.

The states with the highest foreclosure rates were Illinois, where one in every 2,241 housing units had a foreclosure filing; New Jersey, where one in every 2,292 housing units had one; and Ohio, where one in every 2,585 housing units were undergoing foreclosure, according to Attom.

The major cities with the worst foreclosure rates include Cleveland, where one in every 1,326 housing units was undergoing foreclosure; Chicago, where one in every 1,851 housing units were affected; and Philadelphia, where one in every 2,196 housing units were undergoing foreclosure.