Fewer U.S. homes are completing the foreclosure process and ending up repossessed by banks because investors are increasingly buying up properties when they go on sale at public auction.
The trend reflects a growing appetite among investors for buying homes before they exit the foreclosure process and end up on the market.
In New Mexico, 98 homes ended the foreclosure process with a repossession in October, which was by far the fewest repos since April 2012, foreclosure listing firm RealtyTrac Inc. said Thursday.
Some 37,775 homes nationwide completed the process with a repo, down 1 percent from the previous month and a decline of 29 percent versus October last year.
At the front end of the process, lenders initiated foreclosure actions against 383 homes in New Mexico last month, down about 7 percent from October 2012 but up substantially from the monthly average of 283 foreclosure starts during the first nine months of this year.
Nationwide, foreclosure actions were started against 58,939 homes last month, a drop of 34 percent from October 2012, the firm said. Foreclosure starts have been down nationally on an annual basis for 15 months in a row, while home repossessions have fallen annually for 11 consecutive months.
The decline has come about as more homeowners are keeping up with their mortgage payments. At the same time, the U.S. housing market has emerged from a deep slump, aided by rising home prices, steady job growth and fewer troubled loans dating back to the housing-bubble days.
“We’re still firmly on the road back to normal foreclosure levels, but continue to see the foreclosure problem persist in areas that had delays in the foreclosure process,” said Daren Blomquist, a vice president at RealtyTrac.
Those areas generally include states such as Florida, New York and Illinois where the courts must sign off on foreclosures.