The record number of foreclosures seen in 2010 has seriously affected cities that were deemed to be “safe,” according to RealtyTrac. A recent report released by the foreclosure listing firm found that activity is getting worse in unexpected areas as high unemployment and unpromising job prospects continue to force people out of their homes.
Safe Cities Now a Foreclosure Target
Foreclosure rates have been high in cities like Las Vegas and Miami for some time because of their ailing economies, but RealtyTrac surprisingly reported that so-called safe cities had also become a target for increased activity.
Some safe cities that have seen an increase in forclosure include Seattle, Chicago and Houston. They have been relatively immune to foreclosure, especially soon after the housing bust, but now increasing numbers of homeowners are finding themselves on the receiving end of foreclosure warnings and repossessions.
To the surprise of the report, the Houston-Sugar Land-Baytown metropolitan area of Texas, the Seattle-Tacoma-Bellevue area of Washington and the Chicago-Naperville-Joliet areas of Illinois all saw the largest increases in foreclosure activity with 26 percent, 23 percent and 20 percent increases of 2009, respectively.
While their overall foreclosure rates were still lower than heavily-affected areas, their increase in numbers is very telling of the state of the housing market.
High Foreclosure Cities See Drop in Activity
While safe cities have seen an increase in activity, high foreclosure metropolitan areas like Riverside-San Bernardino-Ontario, San Diego-Carlsbad-San Marcos, and Los Angeles-Long Beach-Santa Ana–all areas of California–have seen drops of 20 percent, 17 percent and 16 percent, respectively.
Surprisingly, Las Vegas, now known as the foreclosure capital, saw a 7 percent drop in activity–not as big a decrease as some cities, but still an improvement. The decrease in this and other high-foreclosure areas has been attributed to lenders taking steps to delay foreclosure activity as homeowners get on their feet.
While the activity fluctuations among cities is surprising, especially with safe cities suddenly seeing more foreclosures, Rick Sharga, a senior vice president at RealtyTrac, told MSNBC that the major difference between the two sets of cities is that the safe cities will improve quicker.
“As the economy and unemployment improve, you’ll see those markets recover fairly quickly, whereas you’re still going to have a bit of a hangover in places like California, Florida and Nevada,” he said.
The company acknowledged that holding on to a mortgage loan is going to be more difficult than ever for all struggling homeowners because of the still-high unemployment rate. Though the government is trying to step up foreclosure prevention, if a homeowner doesn’t have money to pay an adjusted monthly mortgage payment, he or she is still in danger of repossession.
