Foreclosure auctions fell sharply in May after three months of increases probably because of a moratorium on foreclosures following the May tornadoes, according to Irvine, Calif.-based property data firm RealtyTrac.
Foreclosure auctions were down 47 percent from April and down 26 percent from a year ago in May, the firm reported.
Foreclosure starts were down 30 percent year-over-year in May, but bank repossessions were up 52 percent, the third straight month with an annual increase, the firm said.
RealtyTrac's Oklahoma Foreclosure Market Report showed foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 1,123 Oklahoma properties in May, a decrease of 11 percent from April and down 13 percent from May 2012.
One in every 1,475 Oklahoma housing units had a foreclosure filing in May, below the national average of one in 885 housing units, No. 28 highest among all states, RealtyTrac said.
The tornadoes are also having a much bigger impact on the area's overall real estate market, according to Sheldon Detrick, CEO of Prudential Detrick Alliance Realty in Oklahoma City and Tulsa.
“We have 4,000 homes totally destroyed, and another 10,000 homes damaged — a large part of which are uninhabitable,” Detrick said. “We lived — in May 1999 — through the previous tornado that struck the area. We know what that was like. And that of course was followed by a construction boom. We had construction crews in here building as fast as they could and we anticipate that trend this time.
“But right now, people can't find a place to live. You can't find a place to rent. Churches are taking in people. People are taking in people. Adversity brings us together, and this is a king-sized adversity. And we are united. We are rebuilding and coming back.”
Detrick said the decrease in May foreclosure activity was largely due to the tornado's aftereffects, which are creating an inventory imbalance that's being exasperated by the destruction of so many homes. That combined with rising costs for building supplies will likely lead to an unprecedented period of home price appreciation in the Oklahoma City market over the next five years, he said.
“I see probably the most prosperous time and the greatest appreciation in real estate may be on record over the next 18 months,” Detrick said, noting that he's been involved in the real estate business for 53 years. “We have pent-up buyer demand. Our listings are down 22 percent from a year ago. We have a significant imbalance of buyers in versus moving out, and that again affects the inventory.”
In Tulsa, scheduled foreclosure auctions dropped 52 percent from the previous month and were down 42 percent annually. Foreclosure starts decreased 34 percent annually while bank repos increased 16 percent during the same time period — corresponding to a recent jump in scheduled foreclosure auctions.
One in every 743 Tulsa housing units had a foreclosure filing in May — above the national average and ranked 68th out of metros nationwide.