The number of new residential foreclosures hit its highest level of the year in July, while the active foreclosure inventory for the month actually dropped 3.1 percent from the June level, according to Foreclosure.com, a company that tracks foreclosure information.

"The decline in active foreclosures can be attributed to many of these properties being purchased," the company announced.

There were 28,130 new residential foreclosures in July -- a 4.95 percent increase over June and a 10 percent increase from July 2005. Michigan, Colorado and Ohio were among the states hardest hit by new foreclosures, the company reported.

The largest monthly increases in new foreclosure rates among states with more than 300 new foreclosures were recorded in Alabama (up 21.3 percent); Colorado (up 12.9 percent); Illinois (up 11.6 percent); Michigan (up 38 percent); Minnesota (up 31.1 percent); Missouri (up 48.2 percent); and Ohio (up 14.3 percent).

Michigan currently has the highest new foreclosure rate per household, with one in every 1,085 homes currently in foreclosure -- the highest foreclosure rate for a state this year, according to the Foreclosure.com report.

"New residential foreclosures across the nation are up this year, driven in large part by increases in adjustable-rate mortgages," said Brad Geisen, Foreclosure.com president and CEO, in a statement.

Geisen also stated that about 35 percent of all available foreclosed homes were purchased in July -- a 5 percent increase over the first half of 2006 and twice the rate of existing-home sales nationwide.

"Cleary, investors are becoming savvier when it comes to buying homes in foreclosure," he said.

California's new foreclosures dipped by 41 percent from June to July, while the active inventory increased by 7.3 percent.

Other large monthly percentage decreases in new foreclosures were found in North Carolina (down 14.3 percent); Pennsylvania (down 21.3 percent); and Texas (down 16.9 percent).

Source:
http://www.inman.com/inmannews.aspx?ID=55284