By Andre Damon
31 August 2007
The following is the first in a two-part series.
Home foreclosures in the US have reached near-epidemic scope and scale. In Detroit, there was one foreclosure filing for every 97 households in July alone, according to RealtyTrac.com, the largest database of foreclosed properties. Michigan, Georgia and California each saw about one foreclosure action per 300 households in only the last month, while Nevada continued to hold the top statewide foreclosure rate of one per 200 households during the same period.
If trends seen during the first six months of 2007 continue, cities like Detroit, Las Vegas and Riverside/San Bernardino, Stockton and Sacramento in California will see one foreclosure action per 15 households this year. Nationwide in 2006 there were 1.26 million foreclosure filings-including default notices, auction sale notices and bank repossessions-and RealtyTrac expects over 2 million in 2007.
The rapid rise in foreclosures was triggered by a slowdown in the growth of housing prices-deflation of the bubble that had been growing for 12 years and ballooned from 2001 through 2005. Although fluctuations in the housing market are difficult to track, a recent Standard & Poor’s/Case-Shiller survey of 20 cities found that single-family home prices fell by 2.8 percent from May 2006 through May 2007.