VOL. 129 | NO. 138 | Thursday, July 17, 2014
Foreclosures Drop 22 Percent in Second Quarter
By Andy Meek
United Housing Inc. has teamed up with Grace-St. Luke’s Episcopal Church to create the first Grace-St. Luke’s GraceBuilders House, which will involve fixing up a foreclosed home for a family in United Housing’s Homebuyer Education program.
It’s an initiative that will push back in its own way against foreclosure and its effects in a neighborhood, and over the course of several weekends, volunteers will do everything from painting to deck and fence construction to home landscaping.
United Housing executive director Tim Bolding said the effort reflects his group’s desire to “increase homeownership across West Tennessee.” Meanwhile, the spread of foreclosure that his group works to prevent has gone in a positive direction of late, with the numbers down noticeably from where they were a year ago.
In Shelby County, 759 foreclosures occurred during the second quarter, according to real estate information company Chandler Reports, www.chandlerreports.com. That’s a 22 percent drop from the 974 foreclosures during the second quarter of 2013.
Year to date, Shelby County has seen 1,540 foreclosures in 2014, in contrast to the 1,997 foreclosures that had happened by this point a year ago. That’s also a 22 percent drop.
Tommie Criswell, vice president and broker with Crye-Leike Realtors Inc., said she thinks the adjustment reflects, at least in part, a strengthening housing market and improvement among borrowers.
“We just had recently a meeting where we discussed all the sales in Shelby County over the last 30 days and the last quarter as well,” she said. “What’s happened is foreclosures have dramatically come out of the marketplace.
“Foreclosure notices were down 54 percent in June. At the same time, new-home sales are up, and the average sales price is up. And partly because of the fewer foreclosures, it’s taking longer for buyers to find something.”
One reason she thinks bank sales may be down is that either investors have snatched up available properties or homeowners who have money to put down – “which they can use to buy a nice home and fix it up” – are doing so.
Others aren’t so sure. Attorney Webb Brewer said recently his firm still deals with a high volume of borrowers facing foreclosure, never mind the recent drop. It’s an example of the odd nature of the pattern of foreclosures, where even an improvement isn’t necessarily universally celebrated as pointing to better times.
In this case, for example, attorneys like Brewer say the improvement may just reflect things such as banks taking longer to get foreclosures underway.
Whatever the cause, there’s reason to believe the decline in foreclosure activity will continue, at least for a little while. That’s because the number of foreclosure notices, somewhat of a leading indicator, also is down significantly.
The notices, which lenders are required to publish in a newspaper of general circulation before a foreclosure sale in Tennessee, offer a kind of advance warning about the trend, and in the second quarter, they were down about 40 percent. Foreclosure notices totaled 1,058 in the second quarter, down from 1,770 in the second quarter of 2013.
That drop in notices doesn’t necessarily mean that many foreclosures will occur in the future, because the filing of the notice gives borrowers time to fix their delinquent loan and save their home before the foreclosure sale.
Meanwhile, 35 commercial foreclosures were filed during the second three months of 2014, almost double the 19 commercial foreclosures during the same period last year.
On the residential front, among the areas that make up the usual hotspots for foreclosure activity from one quarter to the next, the 38118 ZIP code, which covers the Oakhaven/Parkway Village area, saw 57 residential foreclosures during the second quarter. That was the most in one neighborhood, although it was down from 69 during the same period last year.
Frayser’s 38127 ZIP code generated 55 foreclosures, down from 61 during the second quarter of 2013. And Whitehaven’s 38116 ZIP code generated 50 foreclosures, down slightly from 54 during the same period last year.
Chandler Reports is a division of The Daily News Publishing Co. Inc.