(Source: By Austin Bogues, Daily Press, Newport News, Va. (MCT) – The amount of of homes going into foreclosure jumped 11 percent in Hampton Roads in the first six months of 2012, according to a new report, sticking with a national trend where more than 59 percent of metro areas nationwide saw foreclosures spike.
But foreclosures dropped 20 percent from the same period of time in 2011, leading one Old Dominion University professor to say the housing market may be recovering.
According to RealtyTrac, which monitors foreclosure activity nationally, the region remains squarely in the middle of the pack for metro areas in terms of foreclosure rates, ranking 104 out of 212 regions surveyed.
More than 4,200 properties received notices of foreclosure in the past six months, or roughly 1 out of every 155 properties. The top region for rates of foreclosure was Stocktown, California, where one out of every 38 properties — or 2.6 percent in the last six months — were in foreclosure.
Greg Grootendorst, an economist with the Hampton Roads Planning District, said the foreclosure jump in the first six months of 2012 was attributable to a backlog at several banks nationwide. “We’ve expected to see a slight increase in foreclosures as the banks worked on the ones they’ve had on hold,” he said. Grootendorst said less economically distressed homes are on the market than last year, which has helped to stabilize prices with the reduction in supply.
Gary Wagner, a professor of economics at Old Dominion University, said unless foreclosures increase substantially throughout the year home prices are unlikely to drop. “I don’t expect it to have any impact on home prices,” Wagner said.
“The housing market is pretty seasonal, some of these foreclosures maybe related to that,” he said, referring to the RealtyTrac report. Wagner said the median price of a home in the region increased by $9,000 in the second quarter of 2012, compared to the same time period in 2011. “For the last four months we’ve seen prices steadily increasing. From a historical point of view, it looks we’ve turned a corner,” Wagner said.
RealtyTrac said the foreclosure increases may provide an opportunity for potential home buyers as more economically distressed houses will be moved onto the market nationwide.
“Those foreclosure starts are welcome news for prospective buyers and real estate brokers in many local markets where a shortage of aggressively priced inventory has been holding up sales activity,” said Brandon Moore, CEO of RealtyTrac. “Markets with increasing foreclosure starts will likely see more distressed inventory for sale in the form of short sales and bank-owned properties in the second half of the year.”
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