Foreclosures subside, but job losses a worry

Denver-area foreclosures, growing like a cancer a for years, are showing some some strong signs that they are receding.

Denver-area foreclosures in the Denver area first half of 2009 fell by 10.5 from the first six months of 2008. That bucks a national trend of foreclosures continuing to increase nationally, especially in formerly booming areas such as Las Vegas, Phoenix, Miami and California.

There were 10,727 foreclosure filings in the seven-county area, compared with 11,992 from January through June of 2008, according to county public trustee offices surveyed by InsideRealEstateNews.com.

Denver had the most new filings with 3,153 in the first half of the year, but it also showed one of the largest percentage drops, at 16.5 percent. Only Arapahoe County, with a 20.17 percent drop, showed a bigger percentage decline. Broomfield County showed a 15.7 percent increase, but the numbers were small. It went from 152 foreclosure filings in the first half of 2008, to 176 filings in the first half of 2009.

Here is a breakdown for the area:

County 2008 2009 Percentage Change

Adams 3,352 2,963 (11.6)

Arapahoe 3,713 2,964 (20.17)

Boulder 580 643 10.86

Broomfield 152 176 15.7

Denver 3,780 3,153 (16.5)

Douglas 1,235 1,278 (3.2)

Jefferson 2,055 1,989 (3.21)

Carol Snyder, public trustee for Adams County, said much of the foreclosure drop is because big banks had moratoriums on new foreclosures, starting last fall.

But now, banks are back in the foreclosure business, leading to a jump in people losing their homes.

In the seven-county area, there were 1,845 new foreclosure filings in June, a 15.5 percent increase from May.

And while every county showed an increase on a month-to-month basis, the changes were all over the map.

Boulder County, for example, showed slightly less than a 1 percent increase, while Broomfield, showed a 42.86 percent increases. But as always is the case with Broomfield, the numbers are so small that the percentage change, up or down, is not significant.

For the biggest counties, the percentage increases for the consecutive months are: Adams and Denver, 9.6 percent each; Douglas, 33.16 percent; and Jefferson, 26 percent.

Mike Rinner, of the Genesis Group, which tracks housing along the Front Range, said increasingly as people lose their jobs, foreclosures will rise.

Rinner said just about every economist and economic forecasting group is predicting more than another 3 percent job loss in the Denver area.

“You usually do not have a year when you lose 3 percent of your job base and have declining foreclosure rates,” Rinner said.

Foreclosures started earlier in the Denver area than in most places in the country, and started to decline last year. But the first wave of foreclosure was due to people having toxic adjustable rate loans, which skyrocketed, making home buyers unable to afford their mortgage payments.

The next wave of foreclosures will be from people losing their jobs, he said.

“If you lose your job, you lose your home,” in many cases, he said.

Still, Denver should fare better than many other formerly high-flying cities, he said.

“We’ll probably be quicker to rebound, as the fundamentals are better for us,” Rinner said. “We are not showing the job losses of some other areas. And there are so many people in Arizona, for example, where they are so under water, no matter how hard they try to make payments, they figure it is just better to let the banks have it.”

Share this: