Baltimore-area foreclosures up from April, down from 2011

Foreclosure activity in Greater Baltimore and Maryland is following a national trend of short-term increase and year-over-year decline.

In May, one out of every 1,651 Greater Baltimore housing units was in foreclosure — a 7.7 percent spike over April but a 2.5 percent decrease from May 2011, according to data from RealtyTrac Inc.

Statewide, the foreclosure rate increased 20.3 percent from April to May, but decreased 4.1 percent from May 2011. Similarly, the national foreclosure rate increased 12 percent from April to May, but declined 15 percent since May 2011.

There are 205,999 housing units in foreclosure in the United States following two straight months during which that number had dipped below the 200,000 mark.

Although the numbers are mixed, RealtyTrac CEO Brandon Moore said analysis continues to point to a spike in distressed properties.

“U.S. foreclosure activity has now decreased on a year-over-year basis for 20 straight months including May,” Moore said, “but the jump in May foreclosure starts shows that it’s going to be a bumpy ride down to the bottom of this foreclosure cycle.”

Pre-foreclosure sales are on the rise, Moore said, suggesting an increasing number of properties are going to end up selling in short sales or auction sales to third parties rather than bank-owned sales.

That, he added, would be a relatively good development both for lenders and homeowners.

“Pre-foreclosure homes sell at a higher average price point than bank-owned homes,” Moore said.

“More banks are now recognizing that treating the problem of delinquent mortgages with short sales rather than bank repossessions can help them minimize their losses and also avoid taking on more [owned real estate], which they have to manage, maintain and market for sale.”

Article Courtesy of James Briggs of the Baltimore Business Journal.