Recent
surveys have shown that foreclosure sales have dropped to their lowest point in
more than two years. And while according to March data, 8 percent more homes did
enter the foreclosure process from the previous month, that number is down more
than 30 percent from a year ago, according to Lender Processing Services.
CNBC
real estate reporter Diana Olick notes that it could be another delay in the
foreclosure system “as banks try to modify more loans to meet some of the terms
of the [$25 billion] servicing settlement. The foreclosure sales decline also
appears to be exclusively in private and portfolio loans, which again points to
the settlement.”
Meanwhile,
banks are increasing their number of short-sale transactions, and some surveys
have shown that short sales are actually now outpacing foreclosure sales — the
first time that's ever occurred.
“Lenders
are increasingly recognizing that short sales may be a better alternative for
them than foreclosure,” RealtyTrac’s Daren Blomquist told CNBC. “This trend
began in markets with stronger demand and where the distressed inventory tends
to be newer homes (Phoenix, Los Angeles, Las Vegas), but the trend appears to be
spreading to other markets like Atlanta and Detroit.”
Source: “Flood of Foreclosures Still Fails to
Materialize,” CNBC (May 2, 2012)