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U.S. home foreclosure filings jumped 23 percent in the first quarter from the prior quarter, and more than doubled from a year earlier, as more overextended borrowers failed to make timely payments, real estate data firm RealtyTrac said Tuesday.
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Foreclosure filings were far-reaching, rising on an annual basis in 46 states and in 90 of the 100 largest metropolitan areas, to a total of 649,917 properties. The first quarter filings surged 112 percent from the same period last year.
"In most of the states with the highest levels of foreclosure activity, we're still seeing the fallout from overheated home prices and people overextending themselves with risky loans to try to buy those properties," Rick Sharga, vice president of marketing at RealtyTrac, in Irvine, California, said in an interview.
"I'm more convinced that we haven't seen the peak of foreclosure activity yet, and the wave probably won't crest until late third or fourth quarter of 2008," he added.
Nevada, California, Arizona and Florida had the highest foreclosure rates among states during the quarter.
A buying frenzy by speculative investors had sharply inflated home prices in all of those states before a slide into one of the worst housing markets in a century began in 2006.
These states are now inundated with unsold homes, many valued less than the size of the mortgage.
The oversupply is pressing prices down, forcing some owners to walk away and escalating pressure to foreclose.
Many homeowners, particularly those with adjustable-rate subprime mortgages, are struggling to make payments that have skyrocketed when the loans reset.
One in every 54 Nevada households got a foreclosure filing in the first quarter, up 137 percent from a year earlier.
California had the second-highest rate of filings among states with one in every 78 households, soaring by nearly 213 percent above the same period last year.
"The really insidious part is that, particularly if you're in a market with a glut of inventory, as more properties go through foreclosure ... they add properties on the market that are effectively going to be coming in with distress pricing, which makes it even worse," Sharga said.
Georgia, Michigan, Ohio, Massachusetts and Connecticut were the other states with the top 10 foreclosure filings.
Poor underlying economic conditions drove foreclosure filings higher in Michigan and Ohio, according to RealtyTrac.
The share of vacant U.S. homes grew to a record high in the first quarter, the government reported on Monday, as homeowners struggled to find buyers and foreclosures escalated.
The percentage of owner-occupied homes sitting empty rose to 2.9 percent, the third straight monthly rise, for a total of 18.6 million vacancies, U.S. Census Bureau data showed.
With prices seen falling further at a time when there is an overabundant supply, some government mortgage relief programs may not preclude foreclosures from mounting.
Philadelphia, Pennsylvania, for example, has adopted a program that delays foreclosure proceedings on owner-occupied properties until owners have met directly with lenders to attempt a loan workout plan, James J. Saccacio, chief executive officer of RealtyTrac, said in a press release.
"While we're hopeful that programs like those in Philadelphia will have a positive long-term impact, they could be simply deferring another flood of foreclosures," extending the time it takes for housing to recover, he said.
Metro areas in California and Florida had 13 of the 20 cities with the highest foreclosure filing rates. Stockton and Riverside-San Bernardino in California had the top two spots.
One in every 30 households in Stockton got a foreclosure filing during the quarter, 6.6 times the national average.
Las Vegas had the third-highest foreclosure filing rate among metro areas, at one in every 44 households. The rate was up 1 percent in the quarter, and 134 percent from the first quarter of last year.
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