DQNews Archived Article

California Foreclosures at Five-Year Low

by Real Estate Analyst John Karevoll
December, 1997

La Jolla, CA.— The number of California homeowners going into foreclosure dropped to its lowest level in five years in November, the result of a strong economy and rising home prices, a real estate information service reported.

Lending institutions started formal foreclosure proceedings on 8,750 homeowners in November. That was down 29.5 percent from 12,415 for the month before, and down 28.6 percent from 12,257 for November last year, according to DataQuick Information Systems.

November's number was the lowest since 7,805 foreclosure proceedings were started in November 1992. An all-time high was reached in March 1996 when 15,475 Notices of Default were sent out.

"Letting a property go into foreclosure makes sense if you owe more on it than it's worth. With this year's price increases, more people can sell and pay the mortgage off, and maybe even walk away with some money" said Mike Ela, DataQuick president.

The decline in foreclosure activity was most apparent in major Southern California counties. Foreclosure activity in the Central Valley and Inland Empire was down only slightly. It was down moderately in the rest of the state.

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

Foreclosure homes were a large part of for-sale inventory a year ago, dragging price levels down significantly in many neighborhoods. The negative effect is in diminishing and foreclosure homes now sell for 3-4 percent less than their open market counterparts, down from over 10 percent two years ago, DataQuick reported.

Source: DataQuick Information Systems

Media Inquiries: John Karevoll (909)867-9534

Copyright © 1997 DataQuick Information Systems.
All rights reserved.

---