WHY IT MATTERS
Foreclosures can hurt home values, which are important even to people who aren’t likely to sell or buy anytime soon. Home values contribute to the so-called “wealth effect” that helps drive the broader economy by making people more confident about purchases of all types.
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Metro Atlanta foreclosure notices since 2005
Year…..Number…..Percent change
2005…..37,605…..up 3.8 percent
2006…..44,971…..up 19.6 percent
2007…..58,076…..up 29.1 percent
2008…..79,484…..up 36.9 percent
2009…..117,107…..up 47.3 percent
2010…..127,140…..up 8.6 percent
2011…..109,548…..down 13.8 percent
2012…..91,181…..down 16.8 percent
2013…..51,003…..down 44.1 percent
Source: Equity Depot
A sharp decrease in metro Atlanta foreclosure notices this year dropped 2013 totals to a level unseen since prior to the housing crisis.
Experts say Georgians can expect continued improvement on the foreclosure front as the state climbs its way out of the depths of the recession.
Against the backdrop of a recovering housing market, foreclosure notices fell by 44 percent in 2013.
“I don’t think it’s going to spike up unless something happens with the economy, and people start losing their jobs again,” said Todd Emerson, president of the Atlanta Board of Realtors. “We cycled through a lot of distressed sales.”
The 51,003 foreclosure notices filed in 2013 are the lowest for the 13-county metro area since 44,971 notices were filed in 2006, according to data from Kennesaw-based Equity Depot. It’s a 60 percent decrease from the 2010 peak.
December’s 3,140 filings — while a slight increase from November, when there were fewer days to file — are as low as December filings have been since 2005.
The improvements are drastic and have helped heal a housing market that many all but left for dead as values plummeted. Still, there are some signs that the true scale of the recovery may be overstated.
“I think it’s an illusion created to make things seem better,” said Barry Bramlett, whose Equity Depot compiles the numbers. “It doesn’t necessarily mean everything’s hunky-dory.”
Bramlett said he thinks some lenders are entering into deed-in-lieu-of-foreclosure agreements — where homeowners voluntarily transfer the ownership of their property to a lender to be released from their mortgage payments. Or lenders are agreeing to short sales, where the homeowner and the lender choose to sell a home for less than is owed on the property, instead of going through with a foreclosure.
Others are selling mortgage-backed notes to third-party investors like hedge funds to keep foreclosures low, he said.
“It’s why I’m hesitant to say things are better,” Bramlett said. “The reality is, I don’t think anybody really knows.”
Short sales in metro Atlanta have increased this year, as have the number of deeds in lieu of foreclosure, said Daren Blomquist, vice president at RealtyTrac. But the increases represent just a fraction of the change in total foreclosures.
Because foreclosures are so visible, banks are learning to avoid the action, and the bad publicity that comes with it, he said.
“It’s not all or nothing,” Blomquist said. “The market’s getting better, but these foreclosure numbers are making things look a little better than they actually are.”
As fewer homes are sold out of foreclosure, prices continue to rise. Even those homeowners who are distressed have more incentive to fight for their houses when prices are rising than when they are falling, said Eugene James, the Atlanta regional director of the housing information company Metrostudy. Improved incentives to keep one’s home could be part of what is contributing to lower foreclosure numbers, as well.
James said he expects the drop in foreclosure notices to continue into 2014, but that metro Atlanta is finally nearing what he would consider a normal level.
“We were in a housing depression for nearly five years,” he said. “It’s about time we cycle out of the downturn and start heading back up.”
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