IRVINE, CA-Six out of the 10 cities with the nation's highest metro foreclosure rates in March were located in California, according to a new report by RealtyTrac. The monthly report by the Irvine-based company showed that foreclosures rose 47% nationwide in March on a year-to-year basis and were up 7% nationally over February's numbers.

At the top of the list of California and US cities was Stockton, with a 137% spike in foreclosure activity that boosted its rate to one foreclosure filing for every 128 households, the highest metro foreclosure rate in the nation. Other California cities with foreclosure rates in the top 10 included Vallejo-Fairfield, Modesto, Sacramento, Riverside-San Bernardino and Bakersfield.

California was one of three western states that showed significant increases in foreclosures in the latest monthly report by RealtyTrac, with Nevada and Colorado also posting higher rates. Nevada's foreclosure activity increased 29% from the previous month, marking the third month in a row that Nevada registered the nation's highest state foreclosure rate.

Nevada's rate in March was one foreclosure filing for every 183 households or more than four times the national average of one for every 775 households. Colorado's foreclosure rate of one new foreclosure for every 292 households was 2.7 times the national average and second highest among the states.

Colorado reported 6,267 foreclosure filings during the month, an 18% increase from the previous month and a 16% increase from March 2006.Nationwide, RealtyTrac reported 149,150 foreclosure filings, which includes default notices, auction sale notices and bank repossessions, during March.

Although the latest numbers show that foreclosure activity has "shifted into a higher gear" in the first part of this year, RealtyTrac CEO James Saccacio observes that US foreclosure activity overall "is not far above historical norms." Saccacio also comments that foreclosures "are causing a major disruption in the subprime sector of the lending industry."

That subprime disruption has touched the commercial real estate sector locally with the Chapter 11 bankruptcy filing of one of the country's largest subprime lenders, New Century Financial Corp., which occupies a significant amount of office space in Irvine. Whether the rising foreclosure rate and subprime industry woes will have a significant impact on the commercial markets remains to be seen, according to many in the industry.

Los Angeles-based REIT Maguire Properties was counting on New Century as a major tenant in one of the REIT's new buildings. However, Maguire has said that the subprime lender's troubles will have relatively little impact in an otherwise strong Orange County office market.

In its latest report, RealtyTrac notes that foreclosures surged in the first quarter last year, followed by a leveling off through the second and third quarters. If that pattern does not repeat itself, and if foreclosure activity continues to accelerate, the industry may encounter more widespread consequences, the latest report says.

The March report shows that California reported 31,434 foreclosure filings for the month, the most of any state and an increase of 36% from the previous month. The state's total was nearly triple the number reported a year ago and accounted for 21% of the nation's total.

The surge in foreclosure activity pushed California's foreclosure rate to one foreclosure filing for every 389 households, third highest among all the states and nearly twice the national average. Las Vegas registered the nation's second highest metro foreclosure rate, one for every 139 households.