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The first 2015 quarterly report, regarding so-called “Zombie Foreclosures,” reveals that 25% of homes in active foreclosure have been vacated by the owner. The figure is determined by comparing a master list of active foreclosures against addresses deemed vacant and applications for change of address logged with the US Postal Service.
This phenomena of abandonment, which is not necessarily a negative practice, can be credited to a longer foreclosure process, according to VP Daren Blomquist. “In states with a bloated foreclosure process, the increase in zombie foreclosures is actually a good sign that banks and courts are finally moving forward with a resolution on these properties that may have been sitting in foreclosure limbo for years.”
10 States with Highest Foreclosure Rates:
2. New Jersey
3. New York
10. North Carolina
Mark Huges, COO of First Team Real Estate in southern California, commented that this issue is a result of “the final cycle of the foreclosure crisis cleanup.”
“We are witnessing a large final wave of walkaways,” he explained. “This has created an uptick in vacated or ‘zombie’ foreclosures and the intrinsic neighborhood issues most of them create.”
This “zombie” effect is not relegated to suburban or rural areas. Atlantic City, Trenton, New York, San Diego and Philadelphia lead the list for metropolises taking a hit with large volumes of foreclosures.
Blomquist notes that, “In many markets there is plenty of demand from buyers and investors to snatch up these distressed properties as soon as they become available to purchase,” so the final bump of foreclosures could prove lucrative for banks to unload the inventory and buyers to scoop up affordable assets.