Enter next phase of the housing crisis.
First quarter sales data released yesterday by RealtyTrac showed that foreclosure accounted for 28 percent of all sales -- the highest amount in a year.
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The slow return of millions of REO homes to the market will keep home prices from recovering. RealtyTrac's James J. Saccio warns: "At the first quarter foreclosure sales pace, it would take exactly three years to clear the current inventory of 1.9 million properties already on the banks’ books, or in foreclosure."
If millions more distressed mortgages, aka the shadow inventory, enter foreclosure, then things could get even worse.
Nevertheless the number of properties in foreclosure declined in the first quarter. Foreclosure filings were reported on 681,153 properties, a 15 percent decline from the previous quarter and a 27 percent decline year-over-year.
Nevada fared the worst with one of every 35 homes in foreclosure. Arizona, California and Utah weren't much better.
To visualize the foreclosure crisis, we used a real estate filter on Google Maps. Each red dot represents a home that was in foreclosure at the beginning of the quarter.
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