Foreclosures are poised to make a rebound on the local housing market. In stark contrast to the national distressed property situation, new foreclosure filings in the Tri-Cities region increased dramatically during the third quarter.
REO filings in the seven Northeast Tennessee county markets were up 647.6% compared to Q3 last year. That could be good news for buyers in a market that has been starved for new inventory all this year, said Northeast Tennessee Association of Realtors President Marsha Stowell. But for sellers who have been getting close to asking price increased competition from discounted distressed properties is another matter.
The increase represents 785 properties, according to ATTOM Data Solutions’ Q3 Foreclosure and Market Report. ATTOM is the new parent company for RealtyTrac.
When notice of trustee sale filings are added to the REO filings, the total jumps to 855 properties. Filings in the two SW Virginia markets covered in the report were flat compared to Q3 last year.
The lion’s share of the new REO filings – 336 properties – are in one of the region’s hottest, and most expensive markets – Washington County, TN. That market also the second tightest inventory of homes for sale last month.
The second largest group of new filings came in Johnson County – 183 properties – followed by Greene County with 109 new filings. When compared to Q3 listings last year, the Greene County region had the tightest inventory in the region last month.
Here’s how the new REO filings for the remaining counties shake out:
- Carter – 69
- Hawkins – 32
- Sullivan – 57
- Unicoi – 19
- Bristol, VA – 4
- Washington Co. VA – 16.
It’s not clear how the REOs will be marketed or exactly when they will hit the market. There’s also no information on the price range of the properties.
Tennessee is a non-judicial state and REOs can hit the market anywhere from three months to two years from the filing date depending on circumstances.
The localized version of ATTOM’s Q3 Report is a stark contrast to the national situation. New filings were down 10% from Q3 last year in what was called the final nail in the foreclosure market’s coffin.
“Foreclosure activity has been on a steady slide downward over the past six years, finally dropping back below pre-crisis levels in September,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “While we’ve know that the national foreclosure problem has been dying a long, slow death for quite some time, the final nail in the coffin of the foreclosure crisis is the year-over-year decrease in the average foreclosure timeline nationwide that we saw in Q3 2016 — the first time that’s happened since we began tracking foreclosure timelines in Q1 2007.
“The decrease in the average foreclosure timeline indicates that banks have worked through the bulk of the legacy foreclosure backlog in most states — with a few lingering exceptions — and that most of the foreclosures being completed now are relatively recent defaults that are more efficiently progressing through the foreclosure pipeline,” Blomquist added.
Locally foreclosure activity began inching up last year with a surge of notice of trustee sales. Then REO filing picked up in the second quarter.
Foreclosure rates and the Delinquent Mortgage Rates for the region stabilized last year and sank to pre-recession levels.
The ATTOM Data Solutions U.S. Foreclosure Market Report provides a count of the total number of properties with at least one foreclosure filing entered into the ATTOM Data Warehouse during the month — broken out by type of filing. Some foreclosure filings entered into the database during the month may have been recorded in previous months. Data is collected from more than 2,200 counties nationwide, and those counties account for more than 90 percent of the U.S. population.