Foreclosure Filings Increase at Slowest Pace in Four Years

From Todays WSJ:

U.S. foreclosure filings rose 6% in February from a year earlier, the smallest increase in four years, according to RealtyTrac.

Severe winter weather temporarily slowed the processing of foreclosure records in some states.

RealtyTrac Chief Executive James J. Saccacio added the leveling of the foreclosure trend isn't necessarily evidence that fewer homeowners are in distress and at risk for foreclosure, but rather that foreclosure-prevention programs, legislation and other processing delays are capping monthly foreclosure activity.

The market researcher reported foreclosure filings on 308,524 U.S. properties in February, up 2% from January. Default notices, meanwhile, were up 3% from the prior month but down 3% from a year earlier. Scheduled foreclosure auctions and bank repossessions were both down from January, but grew from a year earlier.

Nevada posted the top foreclosure-filing rate for the 38th consecutive month despite a 30% year-over-year decrease. One in every 102 Nevada homes received a filing, more than four times the national rate. Even with a 9% decline in February from the prior month, Las Vegas was the worst metropolitan area, with one filing for every 90 homes.

Arizona and Florida followed with nearly identical foreclosure rates, with one in every 163 homes receiving a filing in both states. Despite a nearly 21% decrease in foreclosure activity from January, Arizona's rate was fractionally higher than Florida's.

California, meanwhile, posted a 15% year-over-year decline in February. Six California and Arizona metro areas were in the top 10 nationally, while Florida again had two.

In absolute terms, six states—California, Florida, Michigan, Illinois, Arizona and Texas—accounted for 61% of the national total in February. But the total of foreclosure filings in those states fell 5% from January and 15% from a year earlier.

I've heard a lot of rumormongering of "another wave of foreclosures" but seriously, this resembles the market of the early 90's when a similar economic bust ( remember the S&L scandal?) ravaged the economy, the real estate market, and everyone's general attitude. The doom and gloom squad was out in force then too, telling us that things would take years and years to recover, if ever. Then as now, it almost seemed like the doom and gloom guys were secretly buying for their own account and didn't want any competition. In all this talk, people often forget, the financial press has one mission only: make stocks look like a good investment. Since the primary competition for extra money is real estate, they really pour it on when the cycle turns down, and many folks who would be buyers are left by the roadside as prices increase rapidly due to pent up demand. If you need a bigger house, and you can maintain or increase your income stream in the next few years, don't let a lot of people tell you not to buy. Even the guy that bought at the peak of the '89 real estate frenzy was made whole (plus some 40%) and in this cyclical downturn, we haven't seen prices go back to the previous bottom.