DQNews Archived Article

California Foreclosures Down

by Real Estate Analyst John Karevoll
March, 1997

La Jolla, CA.— The number of California homeowners going into foreclosure appears to be declining, a real estate information service reported.

Lending institutions started foreclosure proceedings on 12,684 homeowners in February. That was down 12.9 percent from 14,561 for January and down 8.5 percent from 13,868 for February last year, according to DataQuick Information Systems.

February was the third month in a row showing a year-over-year decline in the state's number of recorded Notices of Default, the first step of the foreclosure process. Part, but not all, of the year-over-year decline is due to unusually high numbers a year ago when lenders tightened their foreclosure policies.

"It's a pretty sure bet that 1997 will be the first year of the 1990s that foreclosures will drop. With today's strong home sales and rising prices, more distressed properties are being absorbed by the market before foreclosure proceedings start," said Mike Ela, DataQuick president.

The decline in foreclosure activity was strongest in Southern California, which is now recovering from the state's steepest drop in home values. The likelihood of default increases as the amount of equity in a home declines.

February's year-over-year drop in foreclosure starts was 39.2 percent in Orange County and 34.2 percent in San Diego County. The default counts in both counties were the lowest in two years.

DataQuick monitors real estate activity nationwide, and provides information to consumers, lending institutions, title companies and industry analysts.

Foreclosure activity is still on the rise in the Central Valley, but will level off this summer if current trends stay in place, DataQuick reported.

Source: DataQuick Information Systems

Media Inquiries: John Karevoll (909)867-9534

Copyright © 1997 DataQuick Information Systems.
All rights reserved.

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