story by Kim Souza
Between the holidays of Thanksgiving and Christmas, 327 homeowners across the state of Arkansas faced foreclosure threat.
The Fort Smith metro area contributed just 12 of those foreclosure filings in Sebastian County and 7 in Crawford County, according to RealtyTrac.
The number of local foreclosure filings declined roughly 28% from November. But, filings rose nearly 200% higher than a year ago in Sebastian County and troubled mortgages jumped 133% in Crawford County during the same year-over-period.
Local real estate experts and economists say the worst of the foreclosure crisis has passed, but there will continue to be more distressed properties making their way back into the market this year in the form of bank-owned properties.
On Wednesday (Jan. 16), there were 260 homes listed as foreclosures for sale in the local Multiple Listing Service (MLS), which includes the Fort Smith metro area and Northwest Arkansas.
Agents said the bank-owned properties coming out of the foreclosure pipeline are still trickling into the listing service.
This time last month there were 276 bank-owned properties in the MLS, according to Crye-Leike’s Jim Long. He said these homes are being sold almost as quickly as the come on the market.
Kevin King, broker with Weichert King Realty in Fort Smith, said the homes in better shape are being snapped by the individual buyers pretty quickly, and there are investors waiting on the sidelines to bid as soon as they are allowed by law.
Fort Smith has always been a fairly mature market but did see a spike in foreclosure filings after 2007 through most of 2011. That was until the federal litigation stalled the pending cases through April 2012 for the entire state.
This moratorium on most foreclosures between October 2011 and April 2012 helped push local home prices higher, a welcome site for homeowners. Locally, median home sales prices rose about 6% between December 2011 and December 2012, according to MountData.com.
Corelogic reports 11.6% of the state’s homeowners still owe more than their home is worth, which is a precursor for possible future foreclosure.
John Silvia, chief economist with Wells Fargo, says as home prices recover and the unemployment continues to improve the risk of foreclosure should decline for those homeowners still teetering on the edge.
For the full year of 2012, there were 154 foreclosure filings in Sebastian County and 97 in Crawford County. The foreclosure rate was down 31% in Sebastian County and 20% lower in Crawford County than in 2011.
It’s important to note the annual comparison period involves a time when litigation stalled the foreclosure process from October 2011 to April 2012.
Daren Blomquist, vice president at RealtyTrac, noted in the report: “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. We expect to see continued increases in judicial foreclosure states near the beginning of the year as lenders finish catching up with the backlogs in those states, and another set of increases in some non-judicial states near the end of the year as lenders adjust to the new laws and process some deferred foreclosures in those states.”
Arkansas is a non-judicial state, which means most foreclosures can be completed without a court hearing or judge’s ruling. Homes are auctioned on the courthouse steps each week following the posted status once the loan is at least 60 days in arrears. It took an average of 218 days for a foreclosure to be completed in Arkansas during the fourth quarter of 2012.
Across the nation, there were 1.8 million properties encumbered by foreclosure in 2012, filings were down 3% from 2011 and down 36% from 2010.
2012 FORECLOSURE FILINGS
Fort Smith Metro Area (Properties in the foreclosure process)