Foreclosures dropped to lowest on record, Fed data show

It’s been widely reported that the housing market has returned to pre-crisis health: sales of distressed homes are at a 10-year low, and prices are charting new highs in many metros.

But here’s another way to measure how well housing is performing: in the third quarter, the number of Americans who had a new foreclosure added to their credit report was the lowest back to at least 1999, arguably even before the housing bubble started to inflate.

That’s according to data from the New York Fed, which published its quarterly Report on Household Debt and Credit Tuesday.

Read: Household debt rises by $116 billion as credit-card delinquencies pile up

The regional bank published a series of research notes on the state of the housing market earlier this year, including this piece that looked at how “resilient” the market was. Researchers considered loan-to-value ratios for mortgaged properties, the amount of mortgage debt outstanding, and home prices.

“The household sector remains vulnerable to severe house price declines, although the high level of creditworthiness among today’s borrowers would serve to mitigate that effect,” the researchers wrote, though they acknowledged that their analyses could be refined further.

Read: Americans are taking out the largest mortgages on record

Creditworthiness is high. The median credit score of Americans taking out new purchase mortgages was 760 in the third quarter, up from 754 the prior quarter and well above the lowest point of the subprime bubble years, which was 707 at the end of 2006.

Still, some housing analysts have noted that down payments are lower – and home prices are higher – making purchasers, especially at the low end of the market, more leveraged than ever before.

Read: At the low end, homeowners are even more leveraged than they were during the bubble

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