Golden State pays up
August 14, 2002
California foreclosures take a nose-dive to 10-year lows
Inman News Features
California's foreclosure activity dipped to its lowest level in more than a decade last quarter.
Lending institutions started foreclosure proceedings on 18,144 homeowners during the April-to-June period, a 22.5 percent decrease from 23,406 for the first quarter, and down 7 percent from 19,514 for the same tthree-month period last year, according to a report released today by DataQuick Information Systems.
Last quarter's number was the lowest since DataQuick started monitoring default notices in 1992. The all-time high occurred during first-quarter 1996 when 44,665 defaults were recorded. A Notice of Default is the first step of the formal foreclosure process.
"As odd as it sounds, today's numbers are somewhat low. They'll go up a bit as appreciation rates level off, which we expect will happen before the end of the year. Right now anybody who's in financial trouble has no problem refinancing, or selling the home for more than enough to pay the mortgage off," said DataQuick President Mike Ela.
The median price of a California home was $265,000 last quarter, up 17.3 percent from $226,000 last year. The year-over-year increase was the strongest since the late 1980s.
Three-fourths of the homeowners in default were able to stop the foreclosure process. In the mid 1990s only half the distressed homeowners were able to do that.
A total of 4,477 Trustees Deeds were recorded on homes last quarter. A Trustees Deed is the final step of the foreclosure process, meaning that the lending institutions took those properties back. Last quarter's number was down 17.2 percent from 5,409 a year ago and the lowest since 4,182 were recorded during third-quarter 1991, DataQuick reported.
Tulare, Madera and Fresno counties had the highest relative foreclosure rates, while Marin, San Francisco and San Mateo counties had the lowest, DataQuick reported.
In addition to low foreclosure activity, there is unremarkable activity among other market stress indicators including loan-to-value ratios, seller financing and other unconventional financing usage, shifts in market mix, turnover rates and non-owner occupancy rates, DataQuick reported.
DataQuick, a subsidiary of Vancouver-based MacDonald Dettwiler and Associates, monitors real estate activity nationwide and provides information to consumers, educational institutions, public agencies, lending institutions, title companies and industry analysts.
Copyright: Inman News Service