Home foreclosure listings surged in March

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.

However, certain other markets, such as California, Washington, D.C., and South Dakota, saw larger percentage increases in foreclosures between February and March, which could indicate a turn in those markets. Although the total number of foreclosures remains low in those markets, the percentage increase rose more than 45 percent.

Fitch Ratings analyst Bob Curran expressed surprise at the increase reported by the study. However, he noted that foreclosed properties still represent a very small percentage of the overall housing inventory, which totaled 2.8 million homes in February. He doesn't see the foreclosure numbers as reason for alarm.

"It may simply reflect our overleveraged society and the fact that people are carrying more debt on everything and it doesn't take a lot to affect a small percentage of them in terms of moving them from homeownership to not," Curran said.

"It's hard to make a case, based on what I see here, that all of a sudden it's become an enormous trend." He said the economy is improving and employment is growing, which bodes well for a homeowner's ability to make mortgage payments.

MORE FROM PERSONAL FINANCE

Personal finance Section Front

Best of both worlds? Combined pension/401k Amid panic, uncertainty, they retired anyway Easing job losses point to wobbly recovery You can handle debt issues better than agencies Long-term jobless face frayed safety net Answer Desk: GDP growth overstates case Calculating the best and worst rental markets Recession over? Readers don't believe it IRS rules for medical deductions are sickening What to know if your bank fails Personal finance Section Front   Add Personal finance headlines to your news reader: