Economy Watch: Mortgages in Foreclosure Drop Steeply Since ’13

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Black Night reported that the number of delinquent U.S. residential loans increased slightly in June compared with May, but is down 15 percent year- over-year.

By Dees Stribling, Contributing Editor

Black Night reported on Tuesday that the number of delinquent U.S. residential loans increased slightly in June compared with May, but is down 15 percent year- over-year. Some 5.7 percent of mortgages were delinquent in June, while 5.62 percent were in May, and 6.68 percent were in June 2013. By Black Knight’s reckoning, delinquent mortgages are over 30 days past due, but not yet in foreclosure.

The percentage of loans actually in foreclosure was down to 1.88 percent in June from 1.91 percent in May. Compared with a year ago, the June 2014 percentage is 36 percent lower (down from 2.93 percent in June 2013), and in fact the lowest percentage of in-foreclosure mortgages since the spring of 2008, the company said.

The number of properties delinquent, but not in foreclosure, is down 445,000 since last year, Black Knight also reported. The number of properties in the foreclosure process is down 507,000 for the year.

Architects report being busier

The American Institute of Architects reported on Wednesday that its Architecture Billings Index for June came in at 53.5, up from 52.6 in May. The index is thus signaling improving conditions for the design and construction industry, according to the organization. As a leading economic indicator of construction activity, the index reflects the nine- to 12-month lead-time between architecture billings and construction spending.

The current score reflects an increase in design activity, since any score above 50 indicates an increase. The new projects inquiry index, which is a component of the overall index, was particularly healthy, coming in at 66.4. That’s up noticeably from last month’s 63.2, and its highest level so far in 2014.

“The recent surge in both design contracts and general inquiries for new projects by prospective clients is indicative of a sustainable strengthening across the construction marketplace,” AIA chief economist Kermit Baker notes. “With the first positive reading since last summer in billings at institutional firms, it appears that design activity for all major segments of the building industry is growing.”

IMF lowers US growth forecast

The International Monetary Fund said on Wednesday that it’s cutting its prediction of U.S. GDP growth for 2014 from 2 percent to 1.7 percent, mainly because of the lousy Q1 suffered by the economy. Over the next 18 months, however, the organization expects annualized GDP growth of 3 percent.

Wall Street had a mixed day on Wednesday, with the Dow Jones Industrial Average losing 26.91 points, or 0.16 percent. The S&P 500, however, was up 0.18 percent mostly on the strength of Apple, to a record nominal high, and the Nasdaq gained 0.4 percent.

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