DQNews Archived Article

California Foreclosures Down

by Real Estate Analyst John Karevoll
October, 1998

La Jolla, CA.— Foreclosure activity in California eased back to 1992 levels last quarter as home values continued to rise, a real estate information service reported.

Lenders started foreclosure proceedings on 28,088 homeowners during the July-to-September period. That was down 9.0 percent from 30,873 for the second quarter, and down 15.0 percent from 33,063 for last year's third quarter (see chart), according to DataQuick Products Division.

Last quarter's number was the lowest since fourth-quarter 1992 when 26,235 homes went into foreclosure. The all-time high was first-quarter 1996 when 44,885 Notices of Default, the first step of the foreclosure process, were recorded.

"As home values go up, the number of homeowners who owe more on their property than the property is worth goes down. Foreclosure activity would probably be even lower today if it weren't for the rise of the so-called sub-prime loan category during the past couple of years," said Mike Ela, leader of DataQuick Products Division.

Home values in California are going up at a 7-8 percent annual rate and last month regained the overall value lost during the recession of 1992-1995.

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

Orange County and the Bay Area experienced the sharpest downturns in foreclosure activity, while San Bernardino County and the Central Valley experienced moderate declines. The upturn in home prices in those areas is relatively recent, and foreclosure activity is expected to recede as price increases move through the market.

The negative impact of foreclosure activity on sales prices has declined significantly. While foreclosure homes tugged sales prices down by more than ten percent two years ago, the drag is currently less than four percent, and is isolated to just a few local markets, DataQuick reported.

Number of recorded Notices of Default

County	3Q97	3Q98	%Chng
Los Angeles	9,696	8,378	-13.60%
Orange County	2,176	1,379	-36.70%
San Diego	1,708	1,370	-19.70%
Riverside	3,011	2,396	-20.40%
San Bernardino	3,389	3,178	-6.20%
Ventura	462	447	-3.30%
So.Calif. Total	20,442	17,148	-16.10%
San Francisco	194	148	-24.00%
Alameda	1,259	960	-23.70%
Contra Costa	1,331	1,012	-24.00%
Santa Clara	832	577	-30.60%
San Mateo	356	267	-25.00%
Marin	146	90	-38.70%
Solano	655	476	-27.30%
Sonoma	328	230	-29.80%
Napa	131	66	-49.20%
Bay Area Total	5,231	3,827	-26.90%
Santa Cruz	124	90	-27.50%
Santa Barbara	253	204	-19.40%
San Luis Obispo	174	145	-16.40%
Monterey	157	150	-4.70%
Coast Total	708	589	-16.80%
Sacramento	2,034	1,756	-13.70%
San Joaquin	929	850	-8.60%
Placer	239	239	0.00%
Kern	745	882	18.50%
Fresno	951	1,017	7.00%
Madera	146	165	12.70%
Merced	196	204	3.80%
Tulare	542	693	28.00%
Yolo	146	75	-49.10%
El Dorado	115	94	-18.90%
Stanislaus	638	551	-13.60%
Inland Total	6,682	6,525	-2.30%
All California	33,063	28,088	-15.00%

Source: DataQuick Information Systems

Media Inquiries: John Karevoll (909)867-9534

Copyright © 1998 DataQuick Information Systems.
All rights reserved.

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