- The Washington Times - Friday, November 2, 2007

LOS ANGELES (AP) — The number of U.S. homes in foreclosure more than doubled in the third quarter, a surge that analysts said will likely drive already weak prices even lower in the hardest-hit areas.

Although that amounts to good news for would-be buyers, it spells trouble for builders with projects languishing on the market and for homeowners desperate to unload property to avoid foreclosure.

“A wave of foreclosures is not going to be good for the broader market, and it will contribute to the weakness in pricing,” said Raphael Bostic, associate director of the Lusk Center for Real Estate at the University of Southern California.

A total of 446,726 homes nationwide were targeted by some sort of foreclosure activity from July to September, nearly doubling from 223,233 properties in the year-ago period, Irvine-based RealtyTrac Inc. said yesterday.

The latest figures amount to one foreclosure filing for every 196 households in the nation and reflect a 33.9 percent jump from the 333,731 properties in foreclosure in the second quarter of this year.

California led the nation in total foreclosure filings and reported one filing for every 88 households.

The state had 148,147 filings on 94,772 properties, an increase in filings of 36 percent from the previous quarter and nearly four times the year-ago period.

All but five states — Kentucky, New Mexico, Oklahoma, South Dakota and Utah — reported a year-over-year increase in foreclosure filings, which include notices of default, auction-sale notices or bank repossessions, RealtyTrac said.

The number of filings reported for the nation in the third quarter reached 635,159, nearly double the level of the year-ago quarter and up 30 percent from the second quarter of this year.

Total filings were greater than the number of properties targeted because a single property can sometimes receive more than one notice in a three-month period.

RealtyTrac Chief Executive Officer James J. Saccacio said August and September accounted for the highest monthly totals since the company began issuing foreclosure filing reports in January 2005.

“Given the number of loans due to reset through the middle of 2008, and the continuing weakness in home sales, we would expect foreclosure activity to remain high and even increase over the next year in many markets,” he said.

Mortgage lenders are bracing for a flood of defaults as many adjustable-rate mortgages that originated in 2005 and 2006 during the height of the housing market frenzy start resetting to higher interest rates.

After California, Nevada and Florida had the highest foreclosure rates during the third quarter.

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