Foreclosures dip, but remain higher than a year ago

IRVINE, Calif. – Rhode Island had the nation’s 26th highest foreclosure rate last month, down from 12th highest in January, RealtyTrac said today.

The state had one foreclosure report for every 1,004 households in February, when a total of 446 foreclosure actions were reported statewide. That was a decline of 43.0 percent compared with the month before. Compared with February 2006, Rhode Island foreclosure reports more than doubled – but the state’s actual increase may be lower, RealtyTrac said, citing its recent expansion of data collection in the Ocean State.

Massachusetts had the 16th-highest foreclosure rate last month, down from 6th the month before, with one report for every 698 households. The 3,906 foreclosure actions reported across the Bay State in February represented a decline of 51.0 percent from the month before but an increase of 56.4 percent from February 2006.

Nationwide, the average foreclosure rate last month – excluding default notices, auction sale notices and bank repossessions – was one filing for every 557 households. The total number of U.S. homes facing foreclosure in February fell 4.0 percent compared with the month before, to 223,651, RealtyTrac said.

Compared with the same month a year ago, U.S. foreclosures rose 59.8 percent, in their 26th consecutive month of year-over-year increases.

“The 4-percent monthly decrease this February was similar to the 6-percent monthly decrease we saw in February 2007,” James J. Saccacio, RealtyTrac’s CEO, said today. ““However, the year-over-year increase of 60 percent this February was significantly higher than the 19 percent year-over-year increase in February 2007, indicating we have still not reached the peak of foreclosure activity in this cycle.”

Nevada once again had the highest rate, with one filing for every 165 households. That was more than three times the national average. California was next, followed by Arizona, Colorado, Michigan, Ohio, Georgian, Indiana and Tennessee.

“With declining prices, there is a pervasive problem of not being able to refinance or sell,” Susan Wachter, professor of real estate at the University of Pennsylvania’s Wharton School in Philadelphia, told Bloomberg News. “I’m very concerned.”

Her comments were echoed by Rick Sharga, RealtyTrac’s executive vice president. “We’re in a vicious cycle,” he said. “We’ve got depreciating home values and loans resetting at an outstanding volume just as banks are retrenching. Even people who want to buy a home now are having trouble getting a mortgage.” Sharga told Bloomberg he expects foreclosure filings to surge in May and June, as more homeowners see their adjustable-rate mortgages (ARMs) reset to higher rates.

RealtyTrac Inc., based in Irvine, Calif., is a publisher of data and advice for real estate markets nationwide. To learn more, visit www.RealtyTrac.com.