Some 20 percent of owners of properties making their way through the torturous foreclosure process are abandoning their homes rather than hoping for a miracle or waiting until the bitter end eventually comes.
RealtyTrac released a report today showing that as of June owners had vacated 167,680 foreclosure properties nationwide, representing 20 percent of all U.S. properties in the foreclosure process. These owner-vacated foreclosures are in addition to 544,274 bank-owned homes nationwide that have been foreclosed on but not sold to a third party.
In addition more than 650,000 homes in the foreclosure process have not been vacated by the homeowner but are likely to end up as short sales, foreclosure auction sales or bank-owned sales in the future, bringing total foreclosure-related inventory on RealtyTrac to nearly 1.4 million.
“Efforts to prevent unnecessary foreclosures and mitigate their impact on home values have resulted in a foreclosure process that takes an average of 477 days nationwide, and more than two years in some states – which is holding many of these must-sell properties off the market,” Blomquist said.
“Even if all these homes flooded the market simultaneously they would likely not cause the once-feared double dip in prices given supply constraints from non-distressed sellers and stronger demand. Given these market dynamics, it’s not surprising to see that Florida, Illinois and New Jersey – states with three of the four longest foreclosure timelines – have all had laws take effect in the last six months that speed up the foreclosure process on vacant properties. These laws should help provide some extra supply and possibly help reduce the threat of another housing price bubble forming in these markets.”
Of the total 167,680 vacant foreclosure properties nationwide, Florida documented the most by far of any state, with 55,503, fully 33 percent of the national total. Illinois posted the second highest total (17,672), followed by California (9,802), Ohio (9,723), and New York (9,173).