California and three other states continued to take an outsize share of the blame for the foreclosure epidemic sweeping the nation.
The Mortgage Bankers Assn. reported Thursday that foreclosures were at record levels, with 1.37% of all home loans nationally starting the foreclosure process during the first quarter of the year.
However, in California, Florida, Nevada and Arizona -- states where housing boomed the most and now has crashed hardest -- the rate of homes entering foreclosure was 2.45%, the trade association said.
"Those states account for about 46% of the foreclosure starts in the country and represented 56% of the increase in foreclosure starts, including half of the increase in prime fixed-rate foreclosure starts," the association's chief economist, Jay Brinkmann, said in a statement. "It is difficult to overstate the severe impact home price declines have had on mortgage performance in those four states."
Perhaps there is some consolation for California: It's not the worst state in terms of foreclosures.
In Florida, 10.6% of the mortgages "are somewhere in the process of foreclosure," Brinkmann said. "In Nevada it is 7.8%, Arizona 5.6% and California 5.2%."
Another sign of the housing market's ongoing struggle to find a bottom came from the Census Bureau on Thursday: Sales of new homes were down 34% in April from the same month a year earlier. Sales rose in April from March, posting a 0.3% month-to-month gain.