The number of home foreclosures tumbled in Michigan during the first half of the year. One analyst says that’s bad news.
Realty Trac reports that home foreclosure filings dropped by about 20 percent during the first six months of 2011. One in 74 homes in Michigan received a foreclosure notice between January and June.
Rick Sharga is with Realty Trac. He says continuing questions about problems with foreclosure paperwork has slowed down the number of properties being repossessed by banks. Federal and state regulators are expected to announce a deal soon clearing major lenders from intentional wrongdoing involving faulty paperwork that mistakenly evicted people current on their mortgages.
Sharga says the delay in foreclosure filings has slowed the recovery in Michigan’s real estate market.
“What over 60% of buyers are looking for right now are bank owned properties or foreclosure properties. So it might be a little of a ‘Catch-22’ here…where we need a higher inventory of these distressed properties to get the buyers off the sidelines.”
Sharga says it may take until 2015 to clear the huge backlog of homes in the foreclosure process which will continue to be a drag on the home sale market.