All eyes on foreclosures.

Though New York City lagged behind most of the country in reported foreclosures in the past year, reporting an increase of 55% compared to 93% on the national level, experts say the city is not immune from the surge.

"New York is still below the national average," said Daren Blomquist, spokesman for RealtyTrac, the firm that released the latest statistics. "But for now, it's impossible to tell if it's not feeling it or if it's behind."

According to the report, the borough that suffered the most was Queens, with a 126% annual increase with 390 filings in July 2006 surging to 882 in July 2007. The Bronx stands in second place in annual filings, with a 54% increase, and Brooklyn saw a 50% increase. Staten Island was the only borough that saw a decrease for the year, 244 in July 2006 and 230 in July 2007, but was second in monthly filings, seeing a 101% jump.

Though Manhattan was fourth of the boroughs in foreclosure filings for the year, growing from 225 to 253, it had the greatest increase from June to July 2007 at 184 percent. The national percent increase for the past month was 9 percent.

Blomquist, however, said that the sharp increase should not be cause for immediate alarm. "There is a big jump in the Manhattan area in terms of the past month, but I have seen big jumps in the past that have leveled back out."

David Brecher, chief executive officer of Trump Financial and First Meridian Corp., said the recent plunge in Manhattan is largely due to investors, who see Manhattan real estate as a cash cow and take large risks for an even greater return, pulling out of properties.

"Investors don't have the legs to last in a downturn. Instead of taking a loss every month, they'd rather jump ship," he said. "There's really not a light at the end of the tunnel and a lot of investors are stepping out. It's primarily investors who are stepping out, not people using properties as their primary residences."

Blomquist said that RealtyTrac, which has been tracking foreclosure actions since January of 2005, has no way of differentiating whether or not those filing for foreclosures are home owners or investors.

But these numbers could continue to rise both locally and nationally and buyers who fell victim to the "exotic" mortgages that allowed for lower initial payments realize they have purchased a home out of their price range, according to Blomquist.

"Because of the tightening of lending markets, those buyers have a tougher time refinancing to a fixed rate," he said, adding that some mortgages are scheduled to reset in 2008 and will lead to even higher rates and most likely more foreclosures.

With the recent instability in the market, Brecher does not see improvement unless the government takes action.

"We've got an economy that has nowhere to go but into recession. If the Fed cut interest rates months ago when speculation was beginning, a good portion of the crisis could have been avoided," he said. "Their number one priority is to fight inflation; while they're doing a good job, there's no way this country can thrive with foreclosure rates in these numbers."