Foreclosures dip from July number

Foreclosure filings in August dipped less than one percent from July but were 18 percent above August 2008 numbers, RealtyTrac of Irvine, Calif., reported today.

As has been the case for most of the three-year-old housing downturn, the lion's share of filings - 60 percent of the total - were centered in Florida, California, Nevada, Arizona and the upper Midwest.

Both Pennsylvania and New Jersey experienced filing increases, though both states remained below the national average.

Pennsylvania's foreclosure rate was one in every 950 houses; New Jersey's one in every 421. The U.S. rate was one in 357.

No. 1 Nevada's rate was one in every 62 houses.

The numbers came a day after the Treasury Department issued a report on the effectiveness of the Obama Administration's Home Affordable Modification Program - designed to lower interest rates on up to four million mortgages.

So far, 360,000 mortgages have been given trial modifications by 45 servicers participating voluntarily in the program. The other part of the Obama initiative - refinancing - has resulted in 2.8 million loans with lower rates of the estimated five million targeted.

There are about 45 million mortgages in the United States.

The number of bank-owned properties - houses repossessed by the lenders after foreclosure - declined by 13 percent from July.

RealtyTrac chief executive officer James J. Saccacio said that drop came because "outflow of bank-owned REO [real-estate owned] properties onto the resale market is being more carefully regulated."

The vast majority of existing home sales in the high-foreclosure states in the last 16 months have been of these bank-owned properties - helping boost sales nationally for the last few months but contributing to double-digit declines in median prices over the same periods.

In low-foreclosure regions such as eight-county Philadelphia area, sales have remained low but sale prices have fallen much less - just 12 percent cumulatively since the third quarter of 2007.

Sale prices actually rose in the second quarter of 2009, led by the city of Philadelphia, according to data compiled by economist Kevin Gillen, vice president of Econsult.

Philadelphia has also been a national model in loan-default-prevention efforts, with its mandatory foreclosure modification diversion program, which as of June had rescued about 1,500 houses from sheriff's sale.