The number of U.S. homes that got started on the path to foreclosure fell last year to a low not seen since before the high-flying days of the housing boom, the latest evidence that the threat of foreclosures continues to diminish.
Lenders also took back the fewest number of homes last year since 2007, at the dawn of the foreclosure crisis, foreclosure listing firm RealtyTrac Inc. said Thursday.
While foreclosures remain elevated in many populous states, such as Florida, New York and California, they have been steadily declining since the U.S. housing market and economy began to rebound after years of decline.
The U.S. housing market has emerged from a deep slump, aided by rising home prices, steady job growth and fewer troubled loans dating back to the housing-bubble days. Meanwhile, more homeowners are keeping up with their mortgage payments.
That's led to fewer homes entering the foreclosure pipeline.
Foreclosure starts totaled 747,728 last year. That's down 33 percent from a year earlier and the lowest annual level since 2006, before the housing bubble burst.
All told, foreclosure starts fell in 37 states, including California, Arizona, Colorado and Georgia, but posted annual increases in 13 states, including Maryland, Arkansas, New Jersey, Connecticut and New York, the firm said.
"Foreclosure starts are a leading indicator that we're getting back to normal, and those are back to normal, back to 2006 levels," said Daren Blomquist, a vice president at RealtyTrac.
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While also down sharply, completed foreclosures—when a home ends up repossessed by a lender—have further to go before returning to normal levels, Blomquist added.