Unemployment-Related Foreclosures on the Rise

It makes sense. Now, a recent report by RealtyTrac links unemployment with foreclosure.

States facing high levels of unemployment are showing above average levels of foreclosure. And according to RealtyTrac, growing unemployment across the nation may have more of an impact on foreclosures than lasting effects from the subprime loan crisis.

While some of the most foreclosure-saturated metro areas posted declining foreclosure activity in the first six months of 2009 (such as Stockton, Modesto, Cleveland, Columbus, Detroit and Toledo), other areas of the country not previously considered foreclosure “hot spots” have seen increased levels of activity. RealtyTrac’s Midyear 2009 Metropolitan Foreclosure Report shows more than 20 percent of the metro areas with above average levels of foreclosure activity were in states such as Oregon, Idaho, Utah, Arkansas, Illinois and South Carolina, suggesting that new foreclosures may be tied to growing unemployment, rather than continuing fallout from subprime and adjustable rate loans. It is predicted that areas with increasing unemployment rates will see increased foreclosure in the future.

RealtyTrac, the leading online marketplace for foreclosure properties, reports that cities in California, Florida, Nevada, and Arizona have the highest rates of foreclosure in the first half of 2009. Those states account for 35 of the 50 highest foreclosure rates in metro areas.

There were more than 1.5 million foreclosure filings in the first half of 2009 in the United States –1.19 percent or 1 out of every 84 homes. This was a 9.46 percent increase from the second half of 2008, and a 14.66 percent increase over the first half of 2008. RealtyTrac ranked the top U.S. metro areas for foreclosure from January to June 2009. The top three were Las Vegas-Paradise, Nevada with 58,691 or  7.45%; Cape Coral-Fort Myers, Florida with 25,926 or 7.20% and Merced, California with 5,725 or 6.89%.

Foreclosure is a pressing topic in real estate. Ilyce Glink, nationally-syndicated columnist, bestselling real estate book author and Newstalk 750 WSB radio talk show host, publishes foreclosure related articles on www.ThinkGlink.com. She is hosting a seminar later next Saturday, October 24th, in Atlanta on How to Profit From Foreclosures.  Use discount code AREF to save 25% off registration.