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1:30pm | A foreclosure report issued today shows a month-to-month drop in foreclosure filings in January, although if history repeats itself that uptick may be a mere graphical blip before an impending storm of negative data on rising foreclosure filings on the horizon, some real estate experts say.

RealtyTrac today released its U.S. Foreclosure Market Report for January showing foreclosure filings—that includes default notices, scheduled auctions and bank repossessions—fell nearly 10% from December. Filings were still 15% above January 2009’s numbers.

“January foreclosure numbers are exhibiting a pattern very similar to a year ago: a double-digit percentage jump in December foreclosure activity followed by a 10% drop in January,” James J. Saccacio, CEO of RealtyTrac, said in a statement. “If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works.”

Foreclosure activity fell by double-digit percentages from the previous month in California, where one in every 187 housing units received a foreclosure filing. California’s foreclosure rate ranked third-highest among the states.

It’s much the same in Long Beach and surrounding areas, where some local Realtors believe there’s a possibility of a flood of foreclosures coming—the calm before the storm so to speak.

“I find it hard to believe that people are surprised by these new numbers,” says Jeremy Colonna, a broker with Colonna & Co. Realty in Belmont Shore. “With unemployment continuing to rise, short-term interest-only loans beginning to adjust and lenders being forced to attempt modifications on borrowers with no hope of being able to make any kind of reasonable payment at all, the circumstances were inevitable.”

And Colonna believes more is yet to come. “Even with lenders like Wachovia, Wells and GMAC really trying to streamline their short-sale process, there are still going to be massive numbers of foreclosures on the horizon. Unfortunately, I have a feeling that many of the sales that took place the latter half of last year may be destined for the same fate. One of the side-effects of living in the United States is that our society is so optimistic that we will often times use more hope than logic in interpreting data. I don't think that prematurely predicting the end of the housing slump has done anyone, even Realtors, any favors.”

Six states accounted for about 60% of nation’s foreclosure total. California, Florida and Arizona posted the three highest state totals in terms of properties receiving foreclosure filings in January, and together those states accounted for more than 44% of the national total, the RealtyTrac report shows.

Illinois posted the nation’s fourth highest total in January, with 18,120 properties receiving a foreclosure filing during the month, Michigan posted the nation’s fifth highest total (17,574 properties) and Texas posted the sixth highest total (12,225 properties).

REO activity for the month nationwide was down 5% from the previous month but still up 31% from January 2009, the report shows. Default notices were down 12% from the previous month but still up 4% from January 2009, and scheduled foreclosure auctions were down 11% from the previous month but still up 15% from January 2009.

“It’s hard to read this report without a dozen thoughts popping into my head at once,” says Sally Doherty, a mortgage loan officer with Bank of America Home Loans.

Among the questions Doherty says are posed with this report are: “Was the month-to-month decrease seasonal due to the holidays or even humanitarian impulses on the part of the loan servicers?” and “Is this a sign that the worst is over in California or merely a lull in a ‘jobless recovery’?”

Doherty also offers some answers: “What I do know is that in our area, the market is absorbing the REOs as quickly as they are coming on the market if they are priced right. We could certainly use more of them. The demand is huge and buyer interest and activity remains high, at least until the homebuyer tax credit comes to an end on April 30. Demand could also wane if interest rates rise when the Federal Reserve ends its support of the housing and mortgage industry when the program for purchasing mortgage back securities from FNMA, FHLMC and GNMA expires at the end of (the first quarter). It’s been an interesting ride and we’re far from finished.”

Dennis Berry, a Keller Williams Realtor, asked around KW company offices in Los Alamitos and Long Beach and collected for Realty Bites a few offhanded remarks on the report from some of his fellow Realtors, which I think balances out some of the negative housing news we are hearing out there lately:

• “Housing seems to be doing okay in the Long Beach area.”
• “Our office had a busy December and a slower January, but February seems to be picking up.”
• “People are still interested in the tax credit.”
• “Our active inventory is around 959 in Long Beach, so there isn’t a lot of properties out there.”
• “Standard sales make up almost half the actives in the MLS.”

Despite a year-over-year decrease in foreclosure activity of nearly 18%, Nevada’s foreclosure rate remained highest among the states for the 37th straight month, the report shows. One in every 95 Nevada housing units received a foreclosure filing during the month, according to the report. A 4% month-over-month increase in foreclosure activity boosted Arizona’s foreclosure rate to second highest among the states in January. One in every 129 Arizona housing units received a foreclosure filing during the month. Utah registered the nation’s fifth highest state foreclosure rate with one in every 231 housing units receiving a foreclosure filing.

Other states with foreclosure rates among the nation’s 10 highest were Idaho, Michigan, Illinois, Oregon and Georgia. Las Vegas documented the highest metro foreclosure rate, with one in every 82 housing units receiving a foreclosure filing.

The report shows that six California cities had foreclosure rates among the top 10 rates registered in the U.S.: No. 3 in the U.S. was Modesto (one in every 107 housing units); Stockton ranked No. 4 (one in 107 housing units); Riverside-San Bernardino-Ontario was No. 5 (one in 109 housing units); Merced was No. 6 (one in 109 housing units); Vallejo-Fairfield was No. 7 (one in 112 housing units); and Bakersfield was No. 8 (one in 118 housing units).

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