Foreclosure Starts Fall to 2006 Level as Home Prices Rise

The rate of new foreclosures in the U.S. dropped to the lowest level in eight years as rising property prices erased negative equity and allowed more delinquent homeowners to sell without losing money.

The share of loans on which foreclosure actions were started declined in the fourth quarter to 0.54 percent from 0.7 percent a year earlier, the Mortgage Bankers Association said in a report today. The rate was the lowest since the third quarter of 2006, when home prices were just starting to fall in what would become the worst crash since the Great Depression.