Inventories have fallen for listings of all types, Seattle based Zillow Inc. said today. The supply of homes listed with the online service is down 12% this month from a year earlier, with inventory tightest for pricier homes, Zillow said. In January the total drop was almost 18%.
Four of the five largest home lenders that signed a nationwide settlement with regulators over alleged abuses in their foreclosure practices increased repossessions in May. Changes in procedures following the two-year investigation and accord, as well as government programs for homeowners, had slowed the rate of seizures.
“Foreclosures have been artificially depressed through government regulation and policy, and are going back to where they should have been,” Michael Krein, president of the National REO Brokers Association, said in a telephone interview. “Prices are rising rapidly in some markets because of the shortage.”
Citigroup Inc. was the only bank among the five that settled last year with U.S. and state officials that didn’t post an increase in repossessions, as Wells Fargo & Co., JPMorgan Chase & Co., Bank of America Corp. and Ally Financial Inc. all showed gains, RealtyTrac said.
“Given the shortage of inventory and rising home prices, banks have little motivation to hold back on any foreclosures, so homeowners who have not been making payments for several months or even years without a foreclosure notice should expect to see that notice coming,” Craig King, an agent at the Reno, Nevada-based Chase International brokerage, said in RealtyTrac’s report.
The biggest annual jumps in states with more than 1,000 home repossessions occurred in North Carolina, up 60% from the previous month, followed by gains of 44% in both Wisconsin and Illinois, 23% in Colorado and 19% in Michigan, according to RealtyTrac.