Foreclosure hotspots are far from healed

By STEVE COOK, Real Estate Economy Watch   |   Jan. 28, 2013 at 5:48 PM   |   Comments

Data reports showing prices zooming in Florida and California markets that once led the foreclosure hit parade mask the reality that prices fell so far in some of those metros they still have a long way to go to reach their peaks in 2007-if they ever do so.

Many markets lost more than 60 percent of equity and the latest November price report from Lender Processing Services shows how far some have to go. Big differences between peak-to-current prices are a measure of how many homeowners are underwater and still far from the point when they will be free of negative equity, the single greatest factor in foreclosures.

Moreover, such great differences between 2007 and current prices locks an entire generation of owners into their existing homes and makes it impossible to refinance or sell.

Peak to current price differences in the largest states that are still hurting: Florida 40.1 percent; Arizona 37.4 percent; California 35.9 percent; Illinois 30.1 percent; Georgia 27.7 percent and Michigan 26.1 percent.

Perk to current price differences in the largest metros that are still hurting: Las Vegas 53.9 percent; Riverside/ San Bernardino 44.8 percent; Orlando 43.4 percent; Sacramento 41.8 percent; Miami 40.5 percent; Phoenix 38.5 percent; Tampa 37.7 percent; and Oxnard 34.8 percent.

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