Dallas Foreclosures Surging in High-End Communities

by on cities

Dallas foreclosures have been surging in high-end communities over the past several months, according to reports from a Texas-based foreclosure tracking firm and the North Texas Realtors.

The number of foreclosed homes priced above $1 million climbed up in Dallas County during the 11-month period ended November by 24 percent from the same period last year. Total residential foreclosures however declined by 12 percent in the county.

In Collin County, foreclosures on high-end homes rose by more than 300 percent from last year. According to the tracking firm, significant increases in foreclosure activity over the past months involved residential properties considered as executive and luxury homes.

However, foreclosed homes priced above $1 million still account for just a small percentage of all foreclosure homes in North Texas. In the Dallas-Fort Worth metro area, for instance, only 161 homes in the $1-million price range were foreclosed this year out of over 33,000 residential foreclosures.

But all in all, the number of homes in the $1-million price range that faced foreclosure this year in North Texas soared by over 20 percent this year. Among the reasons was the difficulty of owners to sell their high-end homes before they go into foreclosure. During the 11-month period ended November, total sales of existing homes worth $1 million and above plunged by 40 percent compared to November 2008.

While the number of Dallas foreclosures in high-end neighborhoods increased, the number of foreclosure actions for homes priced below $100,000 decreased. The biggest drops in foreclosure postings occurred in the low-end sector of the housing market, with Collin County experiencing a 16-percent drop in its low-priced sector and Dallas County posting a nine-percent drop in the same sector.

Meanwhile, the large majority of foreclosures occurred in neighborhoods where houses are priced below $200,000. Over 80 percent of total foreclosure actions in 19 counties in Texas were filed for homes in the $200,000 price range. The percentage indicated that the average families are still the ones being severely affected by the economic downturn.

Despite efforts by the state and the federal government to prevent foreclosures, housing analysts still believe that foreclosure postings will continue to increase, especially in higher-cost communities.

In another report on mortgage defaults, the percentage of delinquent homeowners in the Dallas metro area in October increased to 5.3 percent, up from 3.6 percent in October last year. The foreclosure rate in the metro area also rose to 1.3 percent this year.

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