In what could be a crack in the housing market's sturdy foundation, the number of foreclosed homes put up for sale rose 50 percent between February and March, according to a new study by Foreclosure.com.
The increase is one of the biggest monthly spikes Foreclosure.com has seen since it began tracking the market in 1999, according to Jim Houston, vice president of the foreclosure listing service.
The survey showed 28,190 foreclosed homes were put up for sale across the country in March, which is 50 percent more than in February.
The total number of foreclosed properties available for sale stood at 80,757 at the end of March, up 10 percent from the previous month.
Foreclosure.com tracks government and financial institutions when gathering data on foreclosed properties.
The number of foreclosed properties rose in 47 states in March. Houston attributes this increase to a rise in interest rates during the latter half of 2004 and a slowdown in home price increases.
Houston said it's "possible" this is a sign that the market is turning. However, it's too early to call definitively at this point, he cautioned.
Sometimes, foreclosures are delayed during the holiday season, which may have pushed some February foreclosures into March, he said.
If the spike in foreclosures continues in April, he said, it could signal a trend that the housing market is turning down.
The surge in the number of homebuyers opting for adjustable-rate mortgages over the past few quarters could pose a problem for homeowners as interest rates tick up. "We're starting to see repercussions because of that," Houston said.
Indeed, the markets seeing the largest number of foreclosed properties are those whose home values have stopped rising, such as Ohio, Texas, South Carolina and Michigan.