Foreclosure Levels Still Just Barely Above Pre-Bust Years

It’s been a few months since we took a detailed look at foreclosure stats in King, Snohomish, and Pierce counties, so let’s update those numbers. First up, the Notice of Trustee Sale summary:

May 2015
King: 306 NTS, down 27% YOY
Snohomish: 162 NTS, down 18% YOY
Pierce: 279 NTS, down 14% YOY

The number of trustee sale notices continues to fall. Here’s the chart of foreclosures per business day. All three counties are down month-over-month and year-over-year by that metric as well:

Notices of Trustee Sale: Daily Rate

Here’s how the latest month’s weekday rate of foreclosures in each county compares to the 2000-2007 average and the highest level that was reached during the housing bust.

Daily Rate of Foreclosures

County Latest YOY ’00-’07 Max
King 14.6 -27% 13.4 73.4
Snohomish 8.1 -14% 7.0 37.1
Pierce 14.0 -9% 11.2 47.7

All three counties continue to drop double digits from last year’s levels.

Back in January I said that “2015 seems likely to be the year foreclosure levels return to their pre-bust levels.”

Here’s your interactive Tableau dashboard updated with the latest foreclosure data:

The percentage of households in the chart above is determined using OFM population estimates and household sizes from the 2000 Census. King County came in at 1 NTS per 2,742 households, Snohomish County had 1 NTS per 1,726 households, and Pierce had 1 NTS for every 1,140 households (higher is better).

According to foreclosure tracking company RealtyTrac, Washington’s statewide foreclosure rate for May of one foreclosure for every 1,232 housing units was 17th highest among the 50 states and the District of Columbia. Note that RealtyTrac’s definition of “in foreclosure” is much broader than what we are using, and includes Notice of Default, Lis Pendens, Notice of Trustee Sale, and Real Estate Owned.

Hit the jump for a larger version of the chart that shows the percentage of households in each county receiving a foreclosure notice each month:

Note: The graphs above are derived from monthly Notice of Trustee Sale counts gathered at King, Snohomish, and Pierce County records. For a longer-term picture of King County foreclosures back to 1979, hit this chart and drag the date slider to its full range. For the full legal definition of what a Notice of Trustee Sale is and how it fits into the foreclosure process, check out RCW 61.24.040. The short version is that it is the notice sent to delinquent borrowers that their home will be repossessed in 90 days.


About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

10 comments:

  1. 1

    Does anyone know a way of getting information on the number of judicial foreclosures–either current or historical? Without knowing that, these stats only give a partial picture.

  2. 2

    RE: Kary L. Krismer @ 1

    Yes Kary

    The squatters sit in them for like 8 years, just pay an attorney like $200/mo to keep it in administration forever….cheap rent. The shadow inventory?

  3. 3

    With so many folks still with adjustable loans and with rising interest rates we will see a rise in foreclosures. Add to this, HAMP, the successful mortgage modification program, will terminate at the end of the year, only making matters worse.

  4. 4
    Kipwallbanger says:

    No reason to foreclose on a family when home prices are rising.

    Let em Ride!!!!

  5. 5

    RE: Kipwallbanger @ 4

    And Bulldoze the Homes the Squatters Lived In for Years Delaying Foreclosures

    They’re destroyed anyway…

  6. 6
    Erik says:

    I don’t think the housing market will bust for atleast 9 more years. When it does, I’m pull all my money including retirement to buy as many auction houses as I possibly can.

  7. 7
    FlipperInSeattle says:

    Judicial foreclosures (sherriff’s auctions) in Washington are largely limited to HOAs foreclosing on non-paying units, and either a) gaining (temporary) custody and leasing them out to recoup funds, or b) getting the debt bought by an investor that does the same thing. In either case, they almost always wind up back at the foreclosure auction once the lender of the 1st mortgage forecloses. The lack of any non-judicial data doesn’t meaningfully impact the statistics.

  8. 8

    RE: FlipperInSeattle @ 7 – That’s not necessarily true–particularly now that a bank having over X number of foreclosures in a quarter subjects them to additional rules. Attorneys started reporting more judicial foreclosures a couple of years ago, and I’m pretty sure I mentioned that here at the time. Sometimes reportedly they didn’t even make any sense in that the homeowner had little or nothing to go after. It’s possible that they might have had documentation issues or some such thing.

    BTW, in addition to the threshold number of foreclosure issue, there’s also the fact that a non-judicial foreclosure now takes longer, so the disadvantage of going judicially isn’t as great.

  9. 9
    Mike says:

    By Kipwallbanger @ 4:

    No reason to foreclose on a family when home prices are rising.

    Let em Ride!!!!

    The rates and terms of the loans from 8-10 years ago were often so bad that the deficiency is rising faster than prices. There was one NTS on my block that where the payment rose to $3300/mo after rates indexed. If purchased in 2012, that house would have had a fixed payment in the $2K/mo range… so it certainly makes sense to foreclose on these loans piling up back payments and fees.

  10. 10

    RE: Mike @ 9 – Not to support the “let it ride” theory, but the real test would be whether the prices are rising at a faster rate than the rate of new mortgages, which is where the money would go after a foreclosure. You’d also need to factor in the actual depreciation of the property due to lack of maintenance, which is probably the best reason a bank would not want to “let it ride.”

Leave a Reply

Use your email address to sign up with Gravatar for a custom avatar.
Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Please read the rules before posting a comment.