Area Foreclosures Remain Low

Northwest Arkansas foreclosure activity remained low in December, pushing year-end totals to the lowest since 2006.

“I’ve seen a foreclosure reduction in all price ranges, and it is helping push all prices higher,” said Deborah Peninger, owner of Upward Appraisals in Rogers.

There were 38 Benton County and 30 Washington County homes in the foreclosure pipeline in December, according to RealtyTrac, an online marketplace for foreclosure properties. Totals in both counties were below November rates but slightly higher than December 2011 numbers.

By The Numbers

Foreclosure Filing Summary

Compares the number of filings in December 2011 to December 2012.

2011 2012 Percent Change

Benton County 34 38 +11.8 percent

Washington County 24 30 +25 percent

Statewide 212 327 +54.3 percent

Nationwide 205,024 162,511 -20.7 percent

Source: RealtyTrac

Meanwhile, median home prices jumped to $152,500 in December, according to MountData, a real estate marketing firm. The median price in December 2011 was $139,000.

Peninger said the shrinking foreclosure market is also helping people refinancing to take advantage of historically low interest rates. When a neighborhood has foreclosures, it can pull down values of neighboring houses, she said.

“We are starting to see less of that impact,” Peninger said.

Gavin Edwards, broker at Synergy Realty Group, said homebuyers looking for a good foreclosure deal should act sooner than later.

“Investors are starting to really move on those foreclosed properties,” he said. “There are not as many foreclosure choices as there has been.”

He said Benton County continues providing the most options for homebuyers looking at foreclosures.

Benton County posted 804 foreclosure filings last year, down from a peak of 3,945 in 2009. In 2006, 445 residents faced foreclosure.

Washington County had 489 filings in 2012, down from a recessionary high of 3,059 in 2010. Only 289 homeowners faced foreclosure in 2006.

One major contributor of the 2011 foreclosure drop was a court decision in the state’s Eastern District that ruled only lenders “authorized to do business in the state” could use the nonjudicial foreclosure method. The case was resolved in June 2012. Foreclosure activity picked up a bit but remained below 2011 levels.

Northwest Arkansas mirrored a statewide trend. The 4,599 statewide foreclosure filings in 2012 were well below the 19,757 peak in 2010. The total in 2006 was 4,790.

Foreclosure activity is also slowing across the country. Last year there were 1.84 million foreclosure notices, down from a peak of 2.87 million in 2010. The total dropped slightly from the 1.89 million filed in 2011.

Daren Blomquist, vice president at RealtyTrac, called 2012 the year of the judicial foreclosure, as foreclosure activity increased from 2011 in 20 of the 26 states that primarily use the judicial process.

Arkansas offers both judicial and nonjudicial foreclosures. Judicial cases go through the court system, and the majority of cases go the nonjudicial route because it is cheaper and quicker.

Foreclosure activity declined in 19 of the 24 states using the more streamlined nonjudicial foreclosure process, but he warned there could be a backlog of delayed foreclosures building in some of those states because of recent state legislation and court rulings raising the bar for lenders to foreclose.

“That could mean that although we are comfortably past the peak of the foreclosure problem nationally, 2013 is likely to be book-ended by two discrete jumps in foreclosure activity,” Blomquist said.

He predicted increases in judicial foreclosure states in the beginning of the year as lenders catch up with backlogs. The other increase will be at year’s end in nonjudicial states as lenders adjust to the new laws and process some deferred foreclosures in those states, he said.

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