Ryan McMaken of the Colorado Division of Housing.

Total foreclosure activity in Colorado in the first half of the year dropped 14.7 percent from the same period last year, but that still ranked the state No. 9 in foreclosures, according to a national report released today by RealtyTrac.

The U.S. as a whole showed a 28.3 percent drop on a year-over-year basis, according to the California-based company.

In Colorado, it showed 26,744 total foreclosure filings, or one out of every 84 housing units. That compared with one out of every 111 housing units being in some state of foreclosure nationally. RealtyTrac’s methodology covers everything from the first foreclosure notice until it becomes an REO, or Real Estate Owned, when the bank buys it a public trustee auction.

Ryan McMaken, spokesman for the Colorado Division of Housing, early next month will be releasing his own report, using a different methodology than RealtyTrac.

Foreclosures on pace for 20% drop

“My data for the first half of 2011 is incomplete, but if current trends keep up, it looks like Colorado is on track to end 2011 down about 20 percent down from 2010′s totals.,” McMaken said. “This is somewhat due to many lenders’ policy of slowing down foreclosure processing, but that doesn’t appear to be the only reason, since Mortgage Banker Association data also shows fewer loans becoming delinquent in Colorado.”

Indeed, RealtyTrac’s numbers and the MBA’s analysis, seem to paint different pictures of Colorado’s foreclosure standing, compared with other parts of the country.

“As far as the state-to-state comparisons are concerned, the same disparity continues between Realtytrac’s rankings and those published by the MBA,” McMaken said. “In MBA’s data, Colorado ranks about 35th in delinquencies and foreclosure inventory, while in Realtytrac’s data, the state regularly ranks 9th or 10th in foreclosure activity.”

Still, the two national reports show similar trends.

“Realtytrac’s year-over-year changes reflect a similar trend, although to a slightly smaller extent,” McMaken said. “Nevertheless, it’s clear at this point that so far in the year, Colorado’s foreclosure activity is well below what it was last year.”

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Foreclosure filings in Colorado’s largest counties plunged by 29.5  in July from July 2009, the fourth consecutive month this year that foreclosure activity has dropped from the comparable month last year, according to a state report released today.

The Department of Local Affairs’ Division of Housing reported that monthly foreclosure filings totals have been down year-over-year every month since April. Foreclosure sales at auction fell 15.4 percent during July as compared to July of last year.

There were 2,718 new foreclosure filings in July compared with 3,855 filings in July 2009. There were 1,581 foreclosure sales during July, and 1,869 foreclosure sales in July of last year.

From June to July this year, foreclosure filings rose 0.2 percent, and foreclosure sales at auction fell 10.9 percent. Foreclosure filings are the initial filing that begins the foreclosure process, and foreclosure sales totals are the total number of foreclosures that have been sold at auction at the end of the foreclosure process.

Downward trend

“We continue to see a generally downward trend in both new filings and foreclosure sales at auction,” said Ryan McMaken, a spokesperson for the Colorado Division of Housing. “The decline in sales at auction can be attributed at least in part to the success of programs like the Foreclosure Hotline. However, since foreclosure activity is so closely tied to wages and employment right now, the trend in filings could change at any time in response to the overall strength of the economy.”

Foreclosure activity varied by county. The counties with the largest decreases in foreclosure filings from July 2009 to July 2010 were Weld and Denver, where filings decreased by 38 percent and 39 percent, respectively. Mesa County was the only county surveyed where filings increased. Year-over-year filings in Mesa County increased by 24.6 percent.

Year-over-year, Mesa County was also the only county to report an increase in foreclosure sales at auction. Sales increased 133.3 percent in Mesa County year-over-year. Sales fell most in Larimer County and El Paso County where they decreased by 31.1 percent and 32.4 percent, respectively.

The county with the highest rate of foreclosure sales was Weld County with a rate of 598 households per foreclosure sale. Mesa County came in second with 660 households per foreclosure sale. The lowest rate was found in Boulder County where there were 2,966 households per foreclosure sale. The largest increase in foreclosure rates since 2009 was found in Mesa County where the foreclosure rate increased from 1,540 households per foreclosure to 660 households per foreclosure, year-over-year.

The Division of Housing’s monthly foreclosure report surveys foreclosure activity in the 12 largest counties of Colorado. The report is a supplement to the division’s quarterly foreclosure report that includes all counties in Colorado.

County	July 09	July 10	% Change
Adams	490	350	-28.6
Arapahoe	590	435	-26.3
Boulder	145	99	-31.7
Broomfield	34	31	-8.8
Denver	634	387	-39.0
Douglas	222	162	-27.0
El Paso	530	353	-33.4
Jefferson	390	295	-24.1
Larimer	232	156	-32.8
Mesa	130	162	24.6
Pueblo	137	88	-35.8
Weld	321	199	-38.0
Total	3855	2718	-29.5

Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

The full report is available on the Division of Housing blog: http://divisionofhousing.blogspot.com/

Contact John Rebchook at JRCHOOK@gmail.com

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It also is taking longer to find tenants for homes. The number of days on the market for single-family rentals and similar properties increased from 45 days during the fourth quarter of 2008 to 53 days during the fourth quarter of 2009. Detached single-family rentals in particular faced a two-year high of 62 days.

Federal tax credits turning renters into buyers

“There is no one economic factor behind the increase, but some of the people that had been in single-family have purchased homes to take advantage of the tax credit,” said Gordon Von Stroh, Professor of business at the University of Denver, and the report’s author. “But the unemployment rate remains above last year’s rates, and that will tend to keep vacancies up.”

The tax incentives to buyers “is the other element,” causing fewer people to buy homes, but it not as great of force as it was last fall. The big rush is over,” said Robert Alldredge, principal of Jericho Properties. “Last year, when they thought the credits would expire in November, we saw a big rush of people leaving rental homes to buy houses,” he said. “And those were our most-qualified renters. They were sort of the cream of the crop. But we have not seen as much of that this year. It’s just too hard to qualify for a loan. I think a lot of the renters who were qualified to buy, already have taken advantage of the program.”

The  $8,000 tax credit for first-time home buyers, which requires a home to be under contract by April 30, and closed by the end of June, is not attracting buyers to condos and townhomes, for the most part, he said. There also is a $6,500 tax credit available for qualified homeowners, some of whom may want to sell their home and buy a smaller one, as well as move up.

“The tax credit incentive is driving more toward single-family homes and less than condos and townhomes,” Alldredge said. “People want house and if the government going to give you a hand out, some people will take it, if they can qualify for a loan.’

Susan Melton, the broker/owner of Assured Management in Lakewood, agreed with Alldredge.

“A majority of the good tenants who are taking advantage of the tax credit, want to move into a single-family home, and not a condo or a townhome,” she said. “It had a big impact on us at the end of last year, but we have not seen very much activity so far this year. I think the majority of people who qualified for the program have already taken advantage of it.”

Single-family homes rule as rentals

Single-family detached homes also are more attractive to renters, Von Stroh said.

“The overall vacancy rate has run up to 5.5 percent,” Von Stroh said. “But when you start looking specifically at the data, single-family home rental vacancy rates are about the same,” Von Stroh said. “A year ago, single-family home vacancies were at 4.5 percent and now they are at 4.7 percent. But condo rentals were at 4.5 percent and are now at 6.1 percent. And duplexes were at 4.4 percent, and are now at 7.7 percent.”

Melton  said one reason for that is because if a family loses its homes in foreclosure, it wants to remain in a rental house, and not a condo or a townhome. ”If you look at the units with five bedrooms or more, there is a zero vacancy rate,” Melton noted. “One-bedroom units have the highest vacancy rates.”

The metro-wide jump in vacancies in single-family rentals and similar properties was driven by increasing vacancies in Denver County and Arapahoe County where vacancy rates were at 6.8 percent and 5.7 percent respectively. Vacancy rates fell in Adams County and Douglas County. Rates were flat in Jefferson County and in the Boulder/Broomfield area.

Vacancy rates for all counties surveyed were: Adams, 4.1 percent; Arapahoe, 5.7 percent; Boulder/Broomfield, 3.8 percent; Denver, 6.8 percent; Douglas, 3.0 percent; and Jefferson, 4.7 percent.

Rents still rising

In spite of rising vacancy rates, average rents continued to climb.

The average rent for single-family and similar properties rose to $1016.77 during 2009’s fourth quarter, rising from 2008’s fourth quarter rate of $995.24. 2009’s fourth quarter’s average rent is the highest average rent yet recorded for the fourth quarter.

“The fact that average rents continue to rise shows that renter demand for these properties remains relatively high in spite of a soft overall rental market and poor job growth,” said Ryan McMaken, a spokesperson for the Colorado Division of housing. “Owners can afford to raise rents a little since many people still prefer the roominess of a single-family home to an apartment, but today, fewer people view buying a single-family home as the fail-safe purchase that they once did.”

Average rents for all counties were: Adams, $1024.79; Arapahoe, $995.23; Boulder/Broomfield, $1631.30; Denver, $952.27; Douglas, $1372.91; and Jefferson, $974.90.

It’s the mix

But Melton isn’t seeing rental rates rising.

“If you look over the last 10 years, the overall rental rates have not increased that much,” she said. “Part of the reason rates are up has to do with newer, bigger units entering the rental market from people who either can’t sell their houses or want to wait until they can get a better price. These homes are not only bigger, but have less wear and tear than a home that has been in the rental pool for the past 20 years, so they get a higher price. But overall, I would say rents are flat.”

The Colorado Statewide Vacancy and Rent Study is released each quarter by the Colorado Division of Housing. The report is available online at the this link.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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The ranking is a marked improvement from just a few years ago, when Colorado’s foreclosure rate was leading the nation, according to RealtyTrac, the Irvine, Calif.-based company that released the report. In 2006, Colorado was No. 1 for the most of the year. In 2007, it was usually ranked in the top three.  Even as foreclosure rates soared in other states, surpassing Colorado’s rate, the state was typically on RealtyTrac’s top 10 list.

1 out of 428 households in foreclosure

For January, one out of every 428 households in Colorado was in some stage of foreclosure, compared with the overall U.S. average of one out of every 409 households. And while the national foreclosure rate dropped 9.67 percent from December, Colorado’s dropped by 16.31 percent.   Some 5,029 homes were in some stage of foreclosure from the first Notice of Default to REO (Real Estate Owned) when the bank takes over the property following a public trustee auction, according to RealtyTrac, which collects and sells real estate data.

Colorado holding its own

Ryan McMaken, spokesman for the Colorado Division of Housing, which is last week released its own foreclosure report, using a different methodology, said it makes sense that Colorado has a lower foreclosure rate than the national average, ” given the unprecedented growth in foreclosures in places like Florida, California, Arizona and Michigan.  Colorado simply wasn’t able to keep up with those places when it came to new foreclosures.”

Also, Colorado’s unemployment rate is lower than the national average of just below 10 percent.

“Now employment is the driving factor, and since Colorado has a better unemployment rate than the national average, I expect to see foreclosures here continue to fall behind the national rate,” McMaken said.

Still, “we shouldn’t be smug, of course,” he added. “There’s still no positive job growth in Colorado and we have yet to see what will happen when the home buyer tax credits finally expire,” later this year.

For the entire nation, there were 315,716 properties in January in some stage of the foreclosure process, according to RealtyTrac. REO activity nationwide was down 5 percent from the previous month, but up 31 percent from January 2009; default notices were down 12 percent from the previous month, but up 4 percent from January 2009; and scheduled foreclosure auctions were down 11 percent from the previous month, but up 15 percent from January 2009.

Foreclosure surge may be coming

“January foreclosure numbers are exhibiting a pattern very similar to a year ago: a double-digit percentage jump in December foreclosure activity followed by a 10 percent drop in January,” said James J. Saccacio, chief executive officer of RealtyTrac “If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose onsdelinquent loans where neither the existing loan modification programs or the new short saleand deed-in-lieu of foreclosure alternatives works.”

Nevada was ranked No. 1, with one out of every 95 homes in some stage of foreclosure. Nevada has had that dubious honor for 37 consecutive months. California, Florida and Arizona posted the three highest state totals in terms of properties receiving foreclosure filings in January, and together those states accounted for more than 44 percent of the national total.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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Later, experts said that without the Colorado Foreclosure Hotline, 1-877-601-HOPE, which has received more than 60,000 phone calls, has played a big role in stemming the tide of people losing their homes.

“We’re making good progress,” said Ryan McMaken, who released the report that showed a record 46,394 foreclosure filings last year, an 18 percent increase  from 2008, but only 20,437 foreclosure sales – a 4 percent drop from 2008.

“I think we are doing very well, especially in light of the 2009 foreclosure filings setting a record, but we still had fewer foreclosures being completed,” McMaken said.

Last year, a new state law required people who were facing to receive information about the foreclosure hotline. McMaken noted that there were about 19,000 foreclosure filings in the five-month period when the law was in effect last year, and the hotline received about 18,000 calls during that period.

He noted that some people would have called more than once and not everyone who called the hotline during that time period was just beginning the process. Still, it indicates that people are taking advantage of the free hotline, which is staffed by HUD-approved counselors.

“We know that 16,000 people who called the hotline have reached a resolution,” McMaken said. “If you added another 16,000 people to foreclosure sales, it would had a huge increase.”

Shannon Peer, who heads counseling for the non-profit Brothers Redevelopment, which manages the hotline, said without a doubt it is the single factor that made the biggest dent in the outcome of foreclosure, although he cautioned the state is still dealing with a “foreclosure crisis.”

And it typically takes a great deal of patience and persistence on the part of the homeowners, whether they are trying to get a permanent loan modification, a short sale, or something else.

“This is something that can take many months to resolve,” Peer said. “It is not something that is going to change in a month. It’s a long process. In some ways, it is hard even to compare one six month period to another, because it can take so many months to work its way through the system.”

Statewide, the former hotbeds of foreclosure sales – Denver and Adams County – have shown dramatic drops in foreclosure sales by public trustee offices, noted McMaken.

The growth is primarily occurring in “mid-sized” markets on the Western Slope and eastern plains, which is the past weren’t the victims of rising foreclosures, he said. In some cases, such as around Grand Junction, the problem is because of a job cuts in the formerly growing and lucrative oil and gas industries, he said. In other places, such as Teller and Park counties, people owned homes based on the “drive to buy” principle, can no longer have the income to pay their mortgages, because they either lost their jobs or are grossly under-employed.

In addition, resort communities in places such as Eagle and Summit counties, are reporting rising foreclosures. McMaken said that figures indicate that many of those are second homes and maybe a third of them are some form of timeshare units.

Ron Woodcock, a broker with RE/MAX Southeast, said the overall Denver single-family housing market is the strongest he has seen since moving here from Florida 3-1/2 years ago. He said some counties in Florida had 30,000 foreclosure filings last year.

“We’re really bucking the national trend,” Woodcock said. “We’re nothing like California, Florida,  Nevada or Arizona.”

Woodcock, however, disagrees with some people who say that if mortgage loans were once again assumable, that would help the foreclosure crisis. “Currently, mortgage rates are lower now than they were two or three years ago,” he said. “Why would you assume a loan of 5.5 percent, when you can get a 4 percent loan today? It might help going forward, but it is not going to help today. And while it is harder to qualify for a loan, really what has happened is that we have returned to what it used to take to qualify for a loan.”

McMaken, of the housing division, said the first wave of foreclosures was due to bad ARMs, interest-only loans, and subprime mortgages. Rising unemployment and falling incomes are responsible for most of today’s foreclosures, he said.

Woodcock said some lenders now would rather work with borrowers on loan modifications, rather than short sales, in which the bank accepts less than the mortgage amount. Still there have only been 1,072 permanent loan modifications in Colorado through 2009. (For more on loan modifications, please go to this blog.)

But Woodcock said that he does worry about the so-called “shadow market.” The shadow market is an unknown number of homes held by the banks, which are not actively being marketed. Nationally, the banks may be holding as many as 7 million properties in this fashion, Woodock said.

“An influx of a lot of those homes would have a negative effect on the market,” Woodcock said. “On the other hand, a lot of investors groups are raising money to buy big portfolios from lenders. They’ll step in and buy 50, 60 or 100 homes at one time. Those type of deals aren’t reported in the MLS, but that type of activity is going on.”

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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One out of every 36 households in the Denver area received some kind of foreclosure notice last year, according to RealtyTrac’s Year-End 2009 Metropolitan Foreclosure Market Report released today. That compares to one out of 45 households nationally.

While foreclosures across the U.S. were up 21.2 percent from, they were down about 12 percent in the Denver area, according to RealyTrac.

The Greeley area was ranked No. 29, with one out of 24 households receiving a foreclosure notice, up 6.5 percent from 2008. Colorado Springs was No. 50, with one of 39 households in foreclosure, an 11 percent increase from 2008. Fort Collins-Loveland was No. 70, with one out of 50 households in foreclosure, 19.7% higher than in 2008, and Boulder was ranked 115th, with one out 77 households in foreclosure, a 28 percent jump  from 2008.

Ryan McMaken, of the Colorado Division of Housing, who plans to release his own statewide-foreclosure report next Thursday, today said the RealtyTrac numbers seem to capture what is happening in Colorado. However, he said because of RealtyTrac’s methodology of combining all foreclosure actions and treating them as one number, its data will differ for his. McMaken tracks  initial filings and public trustee sales, separately, for example, while RealtyTrac combines them, along with REOs, which are homes taken back by banks.

“In much of  Colorado – especially in the Denver area – foreclosure activity peaked a couple of years ago, while now other parts of the country foreclosure rates are growing,” McMaken said. “The general trend of their report seems accurate. Of course, our reports will differ as far as actual numbers.”

Nationwide, the report shows that cities in four Sun Belt states accounted for all top 20 foreclosure rates in 2009 among metro areas with a population of 200,000 or more, but foreclosure activity showed signs of spreading into previously insulated areas asunemployment became more of a driving factor.

California accounted for nine of the top 20 metro foreclosure rates, followed by Florida with eight, Nevada with two and Arizona with one. The highest-ranked metro area outside of those four states was in Boise City-Nampa, Idaho, which ranked No. 24 with 4.66 percent of its housing units receiving at least one foreclosure notice in 2009.

“While it was expected that cities from states with the highest levels of foreclosure activity would top the charts, there is evidence that we’re entering a new wave of foreclosures, driven more by unemployment and economic hardship than what we’ve seen over the past few years,” said James J. Saccacio, chief executive officer of RealtyTrac. “Areas like Provo, Utah,Fayetteville, Ark., Portland, Ore., and Rockford, Ill., all posted foreclosure rates above the U.S. average in 2009. And markets like Honolulu, Minneapolis and Seattle saw foreclosure activity increase at more than twice the national pace over the past 12 months — although all three of those markets still had 2009 foreclosure rates that were at or below the U.S. average.”

Las Vegas posted the nation’s highest metro foreclosure rate for the year, with more than 12 percent of its housing units receiving a foreclosure notice in 2009 — more than five times the national average. Las Vegas reported a quarter-over-quarter decline in foreclosure activity in the fourth quarter — as did all the other metro areas with foreclosure rates ranking among the top 10 for 2009.

With 11.87 percent of its housing units receiving a foreclosure notice in 2009, Cape Coral-Fort Myers, Fla., documented the second highest metro foreclosure rate. Other Florida cities in the top 10 were Orlando-Kissimmee at No. 7 (8.17 percent), Port St. Lucie at No. 9 (7.58percent), and Miami-Fort Lauderdale-Pompano Beach at No. 10 (7.16 percent).Merced, Calif., registered the nation’s third highest metro foreclosure rate, with more than 10 percent of its housing units receiving a foreclosure notice in 2009. Other California cities in the top 10 were Riverside-San Bernardino-Ontario at No. 4 (8.80 percent), Stockton at No. 5 (8.62 percent), and Modesto at No. 6 (8.53 percent).

The Phoenix-Mesa-Scottsdale metro area in Arizona documented the nation’s eighth highest metro foreclosure rate in 2009, with more than 8 percent of its housing units receiving a foreclosure notice during the year.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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The good news is that foreclosure filings in Colorado barely rose from 2008 – only a 0.23 percent increase, according to a national report.

The bad news is that Colorado still is ranked No. 10, according to RealtyTrac, based in Irvine, Calif.

The report showed 50,514 total properties in Colorado with some kind of foreclosure action, which equates to 2.37 percent of all housing units in foreclosure. The U.S. average is 2.21 percent.  The report also shows one out of every 42 households in foreclosure, compared with one of every 45 for the U.S. average. Foreclosure activity in Colorado, according to RealtyTrac, rose 28.2 percent from 2007, far below the 120 percent average national increase.

“It’s kind of bizarre that Colorado is still in the top 10,” said Ryan McMaken, noting that the overall rate in Colorado is very close to the national rate. Also, Colorado’s foreclosure activity has been basically flat, while it is still rising in many other parts of the country.

“RealtyTrac combines all of the different kind of foreclosure actions,”McMaken noted, while he separates new filings and homes that actually go to foreclosure sales.

“If you dig deeper, you will find that while our filings are still climbing, the number of sales are going down,” as banks work with borrower to modify loans, he noted. “We do show a net increase in activity, and we probably will continue to do so, as long as the number of filings continue to rise.”

Still, rather than the 10th worst state in the nation as far as foreclosures, he said Colorado is really more in the middle of the pack, he said. That is also affirmed my Mortgage Banker Association numbers, which shows Colorado in the middle of the U.S., as far as delinquent loans.

An earlier report by InsideRealEstateNews.com found that while foreclosure filings in the Denver area rose by 6.4 percent in 2009 from 2008, most of the percentage increases were found in Boulder, Broomfield and Douglas counties, while activity was flat or dropped slightly in Denver and Adams county. (For that report, please visit this blog.)

Nationwide, RealtyTrac  found more than 3.9 million foreclosure actions -  default notices, scheduled foreclosure auctions and bank repossessions — were reported on 2. 8 million properties in the U.S.  in 2009, a 21 percent increase in total properties from 2008 and a 120 percent increase in total properties from 2007.

Four states accounted for more than 50 percent of the nation’s 2009 total, with more than 1.4 million properties receiving foreclosure filings in California, Florida, Arizona and Illinois. And almost half of those – 632,573 – were in California.

“That means that 46 other states split the remaining half,” noted McMaken. He said some people might think that the foreclosure pain was spread fairly evenly among the states, but that is not the case.

“What that means a lot of states are clumped together, and there will be a very small percent separating them,” McMaken said.

Foreclosure filings were reported on 349,519 U.S. properties foreclosure filings  on 349,519 U.S. properties in December, a 14 percent jump from November  and a 15 percent increase from December 2008 — when a similar monthly jump occurred. Despite the increase in December, foreclosure activity in the fourth quarter decreased 7 percent from the third quarter, although it was still up 18 percent from the fourth quarter of 2008.

“As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans,” said James J. Saccacio, chief executive officer of RealtyTrac.

“After peaking in July with over 361,000 homes receiving a foreclosure notice, we saw four straight monthly decreases driven primarily by short-term factors: trial loan modifications, state legislation extending the foreclosure process and an overwhelming volume of inventory clogging the foreclosure pipeline. Despite all the delays, foreclosure activity still hit a record high for our report in 2009, capped off by a substantial increase in December. In the long term a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond as lenders gradually work their way through the backlog.”

Nevada led the nation last year, with more than 10 percent of the homes receiving some type of a foreclosure action in 2009, giving it the dubious distinction of being No. 1 for foreclosures for the third consecutive year.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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Although the foreclosures last year were the second highest on record – topped only by the 27,122 filings in 2007 in the seven-county area – there were signs of encouragement, as well as a sea change in where the foreclosure activity is gaining speed.

Denver County, for example, which a few years ago was ground-zero for foreclosure activity, showed a slight increase in filings in 2009 from 2008. Foreclosures also fell in 2008 from 2007 in Denver County, when it peaked with 8,240 for filings. Denver was the only county to show a decrease in foreclosures in the fourth quarter from the same period in 2008.

Adams County, with many lower-priced homes, also has been at center-stage for foreclosure activity in recent years, but filing activity was flat in 2009 from 2008, as well as the fourth-quarter of 2009 compared with the last three months of 2008. Overall, foreclosure filings in the fourth quarter from the same period in 2008 were up 32 percent. Some observers  are predicting that another wave of foreclosures could sweep over the Denver area next year.

“Our foreclosure sales are actually down about 20 percent from 2008, and the number of foreclosures being withdrawn are up 17 percent,” said Carol Snyder,  public trustee for Adams County.

“That means more people are staying in their homes and not losing them in foreclosures,” Snyder said. “I think that is a more important than the number of filings.”

She said banks appear much more willing to work with homeowners than they have been in the past.

“I think the banks are learning that it is better to modify loans and keep people in their houses than to add more real estate foreclosures to their portfolios,” Snyder said.

Shannon Peer, director of Housing Counseling, agreed, but is still worried that the state may face more foreclosure filings, which could swamp the state and the system.

He said that the Colorado Foreclosure Hotline (877-601-4673), which Brothers manages, has helped a lot of people learn their options, helping to keep many people out of foreclosure and in their homes.

“But there are indications that a second wave of foreclosure filings building,” Peer said, because of the economy. In addition, another round of  option-ARMs are set to adjust upward in the second half of the year, which could be a calamity for homeowners barley hanging on with their current payments, he said.

He said a “second or third-wave of foreclosure filings,” could offset the drop in foreclosure sales, as well as drop the increase in foreclosure cures and withdrawals.

Meanwhile,  Boulder, Broomfield and Douglas counties have experienced the largest percentage increases in foreclosures, although their overall numbers are still smaller than in Denver, Adams and Arapahoe counties.

“This is the highest number we have ever done. Ever,” said Dianne Bailey, public trustee for Douglas County, where the 2,765 filings in 2009 were almost 27 percent higher than in 2008. Boulder foreclosures rose by more than 38 percent, the biggest increase of the seven area counties.

Bailey was surprised in the surge of foreclosures filings.

“I thought they were going to level off after 2008,” she said. “I guess we thought they just couldn’t go any higher.”

More expensive homes entering the foreclosure process is a trend that counselors saw emerge last year, said  Peer, of  Brothers Redevelopment in Edgewater.

“Over the last year, we have been seeing more homeowners who had higher incomes that we had seen previously,” Peer said. “We’re seeing more home values above $250,000 we had seen in the past. In the past, the under $200,000 price range had been the hard-hit market.  We have seen homes in Evergreen in the $800,000 and $900,000 range, we have seen homes down south in the $600,000 to $650,000 price range. I would say this is a trend that started a good eight months ago. ”

He said it was possible that owners of expensive homes were able to hold out longer than people at the lower-wrung of the economy, but now they, too, are losing their jobs.

One of the challenges they face is that because much of the jumbo-loan money has dried up, it is difficult to find buyers for homes that have mortgages larger than conventional limits of $417,000.

“They are being pinched,” Peer said. “Their are very buyers out there unless they can pay cash. And there aren’t many cash buyers.”

Bobby Burnett, principal of Keller Williams Realty DTC, said that while his regular home sales business was way down last year, his short-sale business was up 50 percent to 60 percent from 2008. A short sale is when a lender takes less than the mortgage amount.

Although the prices were “all across the board,” the biggest increase of distressed properties was for ultra-expensive homes.

“We saw them in Parker, Castle Rocky, a bunch in Boulder,” Burnett said. “The only place that seemed semi-insulated  was Castle Pines Village. I find properties are still selling there.”

Many of the expensive homes are selling for huge discounts, he said.

He tried to sell one home west of Sedalia for $1.1 million, which previously had sold for $1.4 million. Later, the home went into foreclosure and another broker sold it for $750,000.

Perhaps one of the biggest bargains is a 9,000-square-foot home on 11 acres in Elbert County that was appraised at $3 million three years ago.  It’s likely now to sell in a short sale for about $800,000, he said.

“The house looks like a southern mansion in Atlanta,” Burnett said.

Denver City Councilman Rick Garcia, who a couple of years created a Foreclosure Task Force, said that he is not surprised that foreclosure activity is rising faster in the suburbs than in the city.

“As I recall a couple of years ago from data from the Foreclosure Task Force, the average price of a home in foreclosure in Denver was around $124,000, far below the median-price of a home in the city,” Garcia said.

Many of those homes, he said, have been purchased with the help of federal funds or have been “gobbled up” by private investors. They have since been “rehabilitated” and put back into the market, he said.

The first round of foreclosures came from “unscrupulous lenders,” who saddled buyers with high-mortgage rates, Garcia said. Many of those homes in Denver have since worked their way through the system, Garcia said.

He said he thinks many more of those kind of loan, as well as no downpayment loans that were not supported by incomes, were made in suburban subdivisions.

“Denver seems to be bottoming out of the foreclosure circumstances,” Garcia said. “Now, I would say we are seeing more of what I would call “traditional” foreclosures, caused by people losing their jobs.”

Ryan McMaken, spokesman for the Colorado Division of Housing, said that the Denver-area data seems to confirm that more expensive homes in suburban areas are now suffering from growing foreclosures.

“Overall, what I would say is that the Denver-area is fairly flat, while foreclosures are rising elsewhere in Colorado,” McMaken said.

Later this months, McMaken will release a report that will show a record number of foreclosure filings in the state. In 2008, there were just under 40,000 foreclosure filings in all of Colorado, but his data will show more than 45,000 filings in 2009.

There are still a few counties to report to the division, but he expects about 47,000 filings when he receives all of the data. “I’m already at something like 45,400,” he said.

He noted that when the foreclosure crisis began several years ago, “the Denver-area was driving it,” and much of the area outside of the metro area remained impervious.

That is no longer true, as more populous areas along the eastern plains, as well as a number of Western slope communities, are seeing huge percentage increases in foreclosures.

“Of course, there are other economic factors driving the foreclosures in a lot of mid-sized counties outside of the Denver metro area,” he said. For example, a downturn in mining and exploration is hurting the Grand Junction area, while the failure of Greeley-based New Frontier Bank hurt ranchers and farmer.

Sources: Public Trustees

*Adams County removed “repeat” filings, which reduced the total amount by about 100 each year.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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