Three years ago, Denver and Colorado were the poster boys for foreclosures.
Realtors, analysts and politicians dreaded RealtyTrac’s rankings of foreclosure rates, because Greeley, Denver and other places were sure to be at the top of the list.
“I remember you and I used to talk back in those days, and it was always more bad news,” said Patty Silverstein, chief economist for the Metro Denver Economic Development Corp. and principal of Development Research Partners In Littleton.
Colorado’s foreclosure black eye is healing. Places like Las Vegas, where about one out of every household is hit by a foreclosure, now are being hammered by mortgage defaults worse than what Denver experienced at its worst.
RealtyTrac, based in Irvine, Calif., released a third-quarter report today that ranks the Denver-Aurora area No. 47 out of 203 metropolitan areas for foreclosure rates. Greeley was the worst in Colorado at No. 33. Other Colorado metro areas: Fort Collins-Loveland, No. 47; Colorado Springs, 56; and Boulder, 98.
The Denver-Aurora area showed one out of every household with some type of foreclosure filing, not far off from the national average of one out of every 136 households.
“If Denver is No. 47, and near the national average, the top ones must be in really bad shape,” noted economist Silverstein.
Now, other parts of the country have caught up – and in many cases, surpassed – what Colorado was experiencing in 2006.
Las Vegas-Paradise, ranked No. 1, saw the number of foreclosures jump by 53.62 percent in the third quarter from the same period in 2008, more than twice the national average of 22.5 percent. The Denver-Aurora area, by contrast, showed a 1.58 percent drop in the period.
“Rising unemployment and a new variety of mortgage resets continued to gradually shift the
nation’s foreclosure epicenters in the third quarter away from the hot spots of the last two
years and toward some metro areas that had avoided the brunt of the first foreclosure wave,”
said James J. Saccacio, chief executive officer of RealtyTrac.
“While toxic subprime mortgages drove much of that first wave of foreclosures, high unemployment and exotic Alt-A Option ARMs are spreading the foreclosure flood to more metro areas in 2009.”
Silverstein also is worried of another wave of foreclosures, but other areas of the country are even more vulnerable and fragile.
“We certainly felt the pain earlier on,” Silverstein said. “And we are certainly feeling like it is time to start seeing some improvements in Denver and all of those nasty numbers coming our way. It is nice to be in a more solid position.”
She said that she is talking to more and more people every day, who want to take advantage of Denver’s relatively low housing prices, and low interest rates. Unlike other parts of the country, there is a feeling in Denver that the worst may be behind us, she noted.
“This is a terrific opportunity to buy,” Silverstein said, although she is worried about another round of foreclosures due to people losing their jobs.
News such as the RealtyTrac report makes Denver more attractive for businesses than other parts of the country, she said.
“That is going to help us from an economic development perspective,” Silverstein said. “Companies looking to expand or relocate, are very concerned about housing prices and the housing market.”
Also, now that Denver is not fighting the foreclosure battle by itself, the area can benefit from federal programs spurred by rising foreclosure rates in places such as California, Florida, and Nevada.
“Obviously, there is a lot of pain in various parts of the country,” Silverstein said. “Certainly, we hate to see that happen. We all benefit from a healthy economy around the country. But that it the way the teeter-totter of the economy works.”
Rank Market Properties with foreclosure filings %Housing Units with filings 1 out of every household with filing % change from 2nd quarter 2009 % change from 3rd quarter 2009
N/A U.S. 937,840 0.73 136 5.40 22.50
33 Greeley 1,234 1.33 75 9.01 23.52
47 Denver-Aurora 9,235 0.89 113 5.48 -1.58
52 Fort Collins-Loveland 1,027 0.81 124 64.58 63.28
56 Colorado Springs 1,926 0.75 133 1.21 15.95
98 Boulder 551 0.45 224 34.39 45.77