Local foreclosures down, homebuilding up in June

The Pikes Peak region’s foreclosure picture continued to improve last month, while homebuilding showed a slight gain.

Foreclosure filings totaled 242 in El Paso County during June, a nearly 31 percent drop from the same month last year and the fewest number of monthly filings since 229 in November 2007, according to a report Friday from the El Paso County Public Trustee’s Office.

For the first half of 2011, foreclosure filings — which start the legal process that can lead to the loss of a home or other property — totaled 1,743 in El Paso County. That’s down 28 percent from the same period last year.

In his report, El Paso County Public Trustee Tom Mowle said a big reason for the slowdown has been a decision by several lenders to delay foreclosure filings while they verify paperwork; the lending industry was criticized last year for having unqualified employees sign foreclosure documents. In addition to the delay in filings, there’s been a reduction in the number of homes sold after working their way through the foreclosure process, he said.

“People now in foreclosure, or on the brink of foreclosure, have more time to avoid foreclosure by finding additional income or selling their property,” Mowle said in his report.

However, foreclosure filings might pick up in the second half of the year as lenders return to a more regular schedule and delayed filings move forward, Mowle said. Also, some homeowners with non-traditional mortgages, such as interest-only loans, might see their monthly payments increase and become candidates for foreclosure, he said.

Single-family homebuilding permits, meanwhile, totaled 131 in June in Colorado Springs and surrounding El Paso County, a 2.3 percent increase from the same month last year, the Pikes Peak Regional Building Department reported Friday.

But during the first six months of the year, single-family permits totaled 679, down 14.9 percent from the same period in 2010, the report showed.

“When you look at the year-over-year comparison, and where we’re sitting right now, everyone would hope that it would be better than what it is,” said Kyle Campbell of Classic Consulting in Colorado Springs and board president of the Housing and Building Association of Colorado Springs. “But it certainly could be a lot worse.”

Campbell said the homebuilding industry has guarded optimism for the second half of the year, in part because of additional troops coming to Fort Carson. The number of builders participating in next month’s Parade of Homes is up from last year, he said.

Building permits are the primary measure of homebuilding activity in the area and are closely watched by economists, building industry members and government officials.

Homebuilders, their subcontractors and trades group employ thousands in the area, and a building slowdown since the local and national economies nose-dived in late 2007 has resulted in large numbers of construction industry layoffs.

Meanwhile, governments, such as the city of Colorado Springs, look to sales tax revenue from the purchase of building materials to help fund their budgets. When fewer homes are built and construction material purchases wane, government budgets suffer.
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