- The Washington Times - Thursday, February 24, 2011

Foreclosures in the Washington region were down 25 percent in 2010, a positive improvement to be sure, but one we should be cautious about celebrating.

In October 2010, news broke about improper handling of foreclosure paperwork at several large banks. As a result, foreclosures fell sharply while the banks began to clean up the messes they had created.

That did not mean, however, that delinquent homeowners were out of the trouble. As we’ve seen for several years, banks are so overwhelmed that they cannot foreclose on every delinquent borrower at once.

Eventually, the paperwork headaches will be worked out, and borrowers in default will still face foreclosure. In fact, some are saying that 2011 will be the peak year for foreclosures.

RealtyTrac predicts that 1.2 million U.S. homes will be repossessed in 2011 - up from 1 million in 2010. If our area sees that kind of increase, it could add to our inventory of unsold homes and make it harder for prices to rise this year.

But for now, Washington-area homeowners are getting a bit of a break. Foreclosure filings fell in the last quarter of 2010 throughout the region, but fell especially sharply in Prince George’s County and the District. Filings were down 42 percent in the District last year - more than in any other jurisdiction in the region.

While we saw nearly 52,000 foreclosure filings last year, they are not dispersed evenly around the region. Less than 1 percent of the District’s housing stock was affected in 2010. Compare that to more than 10 percent of the housing stock in Las Vegas.

Arlington County continues to have the lowest percentage of homes entering foreclosure - just 0.7 percent last year.

But not so far way, Prince William, Stafford and Spotsylvania counties all topped 4 percent. Prince George’s County had the highest rate in the metro area at 4.9 percent, while nearby Montgomery County was at just 1.5 percent.

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