Cities with the most homes in foreclosure

Home prices in Las Vegas, the poster child of the housing crisis, plunged by 61.8 percent from their peak in early 2006 through 2011. Isaac Brekken / AP file

According to data released last week, the worst effects of the housing crisis are beginning to wind down. RealtyTrac’s latest report shows the number of foreclosures in the U.S. in April is down 13 percent to 188,780 from 219,258 a year ago. However, some of the largest cities in the U.S. continue to lag behind the rest of the country and still have long to go before the housing crash has fully run its course.

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RealtyTrac published the number of new home foreclosures in April in the 50 largest metropolitan statistical areas in the U.S. Of those 50 areas, 10 had more than double the national foreclosure rate, which is one out of every 698 new homes. In California’s Inland Empire metropolitan area, the rate was more than triple that. Using RealtyTrac’s foreclosure rates and home price data from Fiserv Case-Shiller, 24/7 Wall St. reviewed the 10 metropolitan areas with the highest foreclosure rates.

The continuing high rates of foreclosures in some areas is a disturbing trend, said RealtyTrac’s vice president, Daren Blomquist. Although the national foreclosure rate appears to have peaked, the massive number of remaining properties yet to be foreclosed may continue to hurt the U.S. market in the long term, he added. The large number of new foreclosures “means that distressed property sales will continue to represent a large portion of overall sales for at least the remainder of this year, which in turn will keep a lid on any robust home price recovery,” Blomquist said.

After reviewing the markets with the highest foreclosure rates, it is clear that regions with the most foreclosures to date are the ones worst affected by the housing crisis. Seven of the 10 metro areas on this list had among the top 10 largest declines in home value from their pre-recession peaks. In six of the 10 regions, houses lost more than half their value in less than six years. In Las Vegas, home prices plummeted 61.8 percent between the beginning of 2006 and the end of last year.

While all 10 metropolitan areas on this list have a high foreclosure rate compared to the national average, in some cities foreclosures have begun to decline, while in others they continue to increase. For example, of these regions with the highest foreclosure rates, the number of new foreclosures fell by 44 percent in Phoenix and by 66 percent in Las Vegas in one year. Meanwhile, foreclosures rose 38 percent in Miami and 59 percent in Tampa.

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24/7 Wall St. spoke with Trulia’s chief economist Jed Kolko. According to Kolko, while the overall decline in home prices is the major underlying force behind these areas’ high foreclosure rates, it is the legal systems of the regions’ respective states that are affecting whether foreclosures are still rising or declining. Florida has a long foreclosure process, which involves the courts on many occasions, while Nevada’s process is much shorter and non-judicial. Florida is therefore far behind in liquidating its foreclosure inventory, while Nevada is far along the process.

24/7 Wall St. examined RealtyTrac’s latest foreclosure figures of new homes for April 2012, as well as the changes in the number of new foreclosures from a month prior and a year prior. In addition, we reviewed historical, current and projected home price changes, provided by Fiserv-Case Shiller.

These are the 10 cities with the most homes in foreclosure:

10. Orlando-Kissimmee, Fla.

  • Foreclosure rate: One in 347 homes
  • Number of homes: 942,312 (24th most)
  • Foreclosures (April 2012): 2,717 (16th most)
  • Home price decline from peak: 54.2 percent (sixth largest decline)

Median home prices in the Orlando area fell by 54.2 percent from their peak in the second quarter of 2006 through the end of 2011. Of the 50 most populous metro regions in the U.S., the Orlando-Kissimmee area has the 10th-highest foreclosure rate in April of one in every 347 homes. Orlando had 2,717 new homes in foreclosure this past April, up 12.9 percent from the 2,406 in April 2011. The forecast for the future is similarly bleak. Fiserv projects Orlando homes will continue to lose value between the fourth quarter of this year and the fourth quarter of 2013, predicting a 1 percent decline in prices over that time period.

9. Chicago-Naperville-Joliet, Ill.-Ind.-Wis.

  • Foreclosure rate: One in 321 homes
  • Number of homes: 3,797,247 (third most)
  • Foreclosures: (April 2012): 11,840 (the most)
  • Home price decline from peak: 36.8 percent (12th largest decline)

From their peak in early 2007, home prices in Chicago fell 36.8 percent through the end of 2011. In April, the Chicago-Naperville-Joliet metro area had the largest number of new homes in foreclosure among the 50 largest MSAs, at 11,840. This represented an increase of 25.5 percent from April 2011 when 9,433 homes entered foreclosure. However, the number of foreclosures represents a 7.63 percent decline from March, when the Chicago area also led all metropolitan areas with 12,818 foreclosures. Another positive sign for Chicagoans: Home prices are projected to rise 6.3 percent annually through 2016, according to Fiserv.

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8. Tampa-St. Petersburg-Clearwater, Fla.

  • Foreclosure rate: One in 315 homes
  • Number of homes: 1,353,158 (17th most)
  • Foreclosures: (April 2012): 4,295 (eighth most)
  • Home price decline from peak: 48 percent (eighth largest decline)

Residents of the Tampa, Fla., metro area watched the median home price in the region fall to $137,000 in the fourth quarter of 2011 — a 48 percent drop from its peak. The region recorded 4,295 foreclosures in April 2012. To make matters worse, that number is up from the April 2011 figure. Last April, only 2,701 new area homes were in foreclosure, meaning that foreclosures increased by 59 percent the past year. One in every 315 homes in this MSA had a foreclosure start this past April.

7. Phoenix-Mesa-Scottsdale, Ariz.

  • Foreclosure rate: One in 313 homes
  • Number of homes: 1,798,501 (12th most)
  • Foreclosures: (April 2012): 5,755 (sixth most)
  • Home price decline from peak: 56 percent (third largest decline)

Home prices in the Phoenix region — the country’s twelfth-largest metropolitan area by housing units — declined by 56 percent from their 2006 peaks through the end of 2011. Although this accounted for the third-largest decline in home prices among all metropolitan areas, the Phoenix region posted a 22.64 percent decline in foreclosures from March, as the number of new foreclosed homes fell from 7,439 to 5,755. Likewise, in the last year, the number of foreclosure starts in the area fell by 44.44 percent, from 10,358 in April 2011 to 5,755 this past April.

6. Salt Lake City, Utah

  • Foreclosure rate: One in 309 homes
  • Number of homes: 410,031 (first least)
  • Foreclosures (April, 2012): 1,326 (23rd least)
  • Home price decline from peak: 19.3 percent (25th largest decline)

Home prices in the Salt Lake City area declined by roughly 20 percent from their peak in 2007 to the fourth quarter in 2011, which is a modest decline compared to other regions on this list. Nevertheless, foreclosure rates were higher than all but five of the largest metros in the country. Compared to the 1,406 foreclosures in April 2011, April 2012’s foreclosures declined by 5.7 percent. This metro area is one of the few on the list that analysts are bullish about; home prices are projected to increase by 9.5 percent from this year’s fourth quarter to the fourth quarter in 2013.

5. Atlanta-Sandy Springs-Marietta, Ga.

  • Foreclosure rate: One in 298 homes
  • Number of homes: 2,165,495 (ninth most)
  • Foreclosures: (April 2012): 7,271 (fourth most)
  • Home price decline from peak: 35 percent (14th largest decline)

As of the fourth quarter of 2011, home values in Atlanta fell by 35 percent from their peak. The Atlanta area has the ninth highest number of housing units of any region on the list, at 2,165,495, and the median price of these homes was just $110,000 in the fourth quarter of 2011. To make matters worse, the area’s April 2012 foreclosure figure was a staggering 7,271 homes — the fourth most among the nation’s largest cities. Things may be on the upswing though as the number of homes in foreclosure fell by 11 percent from the prior month.

4. Sacramento-Arden-Arcade-Roseville, Calif.

  • Foreclosure rate: One in 277 homes
  • Number of homes: 871,793 (23rd fewest)
  • Foreclosures: (April 2012): 3,147 (12th most)
  • Home price decline from peak: 54.7 percent (fifth largest decline)

The first California metro area on this list, the Sacramento-Arden-Arcade Roseville area, had one in 277 homes in foreclosure in April. With home prices down 54.7 percent from their high at the end of 2005, the Sacramento area registered the fifth-largest decline in home prices. The area had the 12th-most foreclosures in the U.S. However, foreclosures are down by 39.01 percent from last year, when April 2011 had 5,160 homes in foreclosure. Additionally, the number of foreclosures also decreased by 26.7 percent from the previous month, from 4,294 to 3,147. Fiserv expects home prices in the area to rise 6.3 percent annually through the fourth quarter of 2016.

3. Miami-Ft. Lauderdale-Pompano Beach, Fla.

  • Foreclosure rate: One in 273 homes
  • Number of homes: 2,464,417 (fifth most)
  • Foreclosures: (April 2012): 9,031 (3rd most)
  • Home price decline from peak: 54.2 percent (seventh largest decline)

The Miami metro region topped all Florida regions in the number of new foreclosures. It also ranks third in new foreclosure rates among the 50 largest metros with 9,031 foreclosures in April, 2012 — a rate of one in 273. While foreclosures in the area decreased between March 2012, and April 2012, to the tune of 9.2 percent, the future appears gloomy. Prices in this region are forecast to fall another 3.8 percent between the fourth quarters of 2012 and 2013.

2. Las Vegas-Paradise, Nev.

  • Foreclosure rate: One in 249 homes
  • Number of homes: 840,343 (22nd fewest)
  • Foreclosures: (April, 2012): 3,378 (10th most)
  • Home price decline from peak: 61.8 percent (the largest decline)

Home prices in Las Vegas, the poster child of the housing crisis, plunged by 61.8 percent from their peak in early 2006 through 2011 — the greatest decline of any of the nation’s 50 largest metros. Although new foreclosures in the Las Vegas-Paradise region declined by 66.1 percent to 3,378 over the past year, the number of foreclosures in April represents a slight increase over March, when 3,301 new homes were in foreclosure. Making matters worse, prices are expected to fall by another 3.3 percent between the fourth quarter of 2012 and the fourth quarter 2013, according to Fiserv.

1. Riverside-San Bernardino-Ontario, Calif.

  • Foreclosure rate: One in 213 homes
  • Number of homes: 1,500,344 (14th most)
  • Foreclosures: (April, 2012): 7,049 (fifth most)
  • Home price decline from peak: 56.6 percent (second largest decline)

As of the fourth quarter of 2011, prices in the Riverside metro area fell by 56.6 percent from their peak, the second largest drop among top-50 metros. In addition, this region is first in terms of the current foreclosure rate, at one in 213. While the number of homes (1.5 million) ranks 14th of the 50 largest regions, the area’s new foreclosure count for April 2012, reached 7,049 — fifth highest overall. It appears, however, that the situation is improving; between March 2012 and April 2012, foreclosures dropped 10.8 percent.

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