As the housing industry continues to recover we see occasional troublesome spikes in one statistic or another.  RealtyTrac reported a couple of such statistics in its U.S. Foreclosure Market Report for January, surges that, at first glance look ominous, but are probably good news.

First, RealtyTrac reports that overall foreclosure activity increased during the month, driven primarily by a large uptick in completed foreclosures or bank repossessions which surged to a 15 month high and a much smaller increase in scheduled foreclosure auctions.  Rather than signaling further trouble, however these numbers, occurring as they do in the last two steps in the process, are likely indications that lenders are finally, to paraphrase Daren Blomquist, RealtyTrac vice president, "cleaning up." 

RealtyTrac reports that overall foreclosure activity during the month included filings - default notices, scheduled auctions, and repossessions - on 119,800 properties nationwide, a 5 percent increase from December but 4 percent fewer filings than in January 2014.   The number represents a filing on one of every 1,102 housing units in the country.

Bank repossessions soared by 55 percent from December with a total of 37,292 properties foreclosed during the month.  This was an increase of 23 percent from January 2014 and the highest monthly total since October 2013.  Still, the January figure was down 63 percent from the peak of 102,134 in September 2010. 

"The year-over-year increase in REOs in January was the first annual increase nationwide following 25 consecutive months of declines, getting the foreclosure spring cleaning we anticipated in our last foreclosure report off to a quick start in 2015," Blomquist said. "Meanwhile, the number of future foreclosure auctions scheduled in January continued to increase in many states, foreshadowing more foreclosure spring cleaning to come in the next several months in those states."

Twenty-seven states posted year-over-year increases in completed foreclosures, many rising to levels not seen in months or even years.  Among states with the most dramatic increases were Ohio (+197 percent), New Jersey (+116 percent to a 51-month high), Maryland (+100 percent), Washington (+75 percent to a 39-month high), Arizona (+61 percent to a 20-month high), California (+58 percent to a 24-month high), Pennsylvania (+44 percent to a 42-month high), Michigan (+39 percent to a 16-month high), North Carolina (+38 percent to a 15-month high), Texas (+24 percent to a 16-month high), and New York (+24 percent to a 55-month high.)

Foreclosure auctions were scheduled for a total of 51,782 properties in January up 8 percent from the previous month but 7 percent fewer than a year ago and 67 percent below the peak of 158,105 in March 2010. Scheduled auctions were up in 21 states compared to one year earlier.  Among the largest increases was a 268 percent jump in Massachusetts, 125 percent in New Jersey, and 111 percent in North Carolina.  New York rose 79 percent to a 55 month high and Missouri was up 74 percent to a 29 month high.

"It's important to note that in most of these states, foreclosure auctions and REOs are coming off somewhat artificially low levels last year and are still far below the highs reached during the worst of the foreclosure crisis back 2009 and 2010," Blomquist noted.

After spiking to a 17 month high at year end foreclosure starts retreated 18 percent in January to a total of 48,838 properties.  This was down 15 percent from a year earlier and broke a two month streak of year-over-year increases.

Nineteen states had larger numbers of foreclosures starts than a year earlier.  In Nevada starts were up 255 percent and Indiana and Massachusetts saw increases of 45 percent and 14 percent respectively.

There were some hot spots among metropolitan areas.  In nine of the 20 most populous there were overall increases in foreclosure activity compared to a year earlier with the largest in St. Louis where filings increased 47 percent primarily because of a 51 percent growth in scheduled auctions.  The 1,116 total filings in the area was also a month-over-month gain of 52 percent. 

Phoenix also saw jump in activity with filings up 104 percent for the month to a 20 month high and a 45 percent increase from the previous January.  Foreclosure auctions - which constitute foreclosure starts in Arizona, increased 37 percent from a year earlier and bank repossessions were up 58 percent.  

San Francisco had 1,279 filings, an increase of 49 percent from December and 35 percent from a year earlier.  In Los Angeles 5,663 filings represented a +59 percent change from December and +34 percent from a year earlier.  There were 1,874 filings in Seattle, a 19 month high and 63 percent more than in December and 31 percent above filings a year earlier.

The nation's highest level of foreclosure activity was again in Florida where one in every 441 housing units received a filing during the month.  Activity in the state however was down 21 percent from a year earlier.  Nevada was second nationally with filings on one in every 493 housing units and Maryland, with a one in 611 filing rate, was third.