By Mike Colpitts
The gambling capital of the U.S., Las Vegas posted the nation’s highest foreclosure rate among metropolitan areas with populations of more than 200,000 in July, but housing foreclosures are spiking in the majority of other top 20 hardest hit housing cities. The gap is shrinking between the gambling mecca and major cities based on population as the nation’s largest communities take a financial beating in terms of foreclosures.
A sweeping 14 cities in the top 20 metropolitan areas experienced increases in foreclosures during the month, according to RealtyTrac, which gathers foreclosure data. Stockton, California, long regarded as one of the worst foreclosure markets in the nation saw an increase of 57% in formal foreclosures during the month. One in every 124 residential housing units was posted with a notice of foreclosure of one type or another.
In Northern California, Vallejo became the fourth hardest hit city in the nation for a foreclosure notice as the value of homes continues to plummet in the North Bay city. One out of every 140 homes was posted with a foreclosure notice during the month, representing a 33% month over month increase.
Foreclosure activity also increased in many Florida cities as the Sunshine state is plagued with the second highest number of foreclosures statewide due to its highly volatile vacation resort market. Naples saw foreclosure activity increase a stunning 83% on a month to month basis, posting the 15th highest metro foreclosure rate in the country.
Activity was also up 60% month over month in Ocala, Florida, which posted the 17th highest foreclosure rate. The foreclosure crisis is getting some home buyers off the fence as they take advantage of near record low mortgage rates, which haven’t been as low as they are since last October, and may still see further drops in coming days with volatile financial markets.
Bank owned foreclosures are taking longer to sell than others, extending the time it takes for REO foreclosures to be re-sold. A study by Foreclosure Radar found that investors are much quicker to resell properties than banks. California banks took an average of 104 days longer than third party investors to sell properties that had been foreclosed.