DQNews Archived Article

California Foreclosures Down

by Real Estate Analyst John Karevoll
July, 2000

La Jolla, CA.— The number of California homes going into foreclosure continued a four-year decline, the result of strong home sales and rising home prices, a real estate information service reported.

Lending institutions started foreclosure proceedings on 21,440 homeowners during the second quarter of this year. That was down 16.1 percent from 25,552 for the previous quarter, and down 15.6 percent from 25,407 for the second quarter a year ago, according to DataQuick Information Systems.

Last quarter's number was the lowest since 18,806 in first-quarter 1992. The all-time peak was first-quarter 1996 when 44,665 homes went into foreclosure.

"A foreclosure can happen when a homeowner owes more on the home than it could be sold for. With prices going up, and with sales counts as strong as they are, fewer and fewer homeowners find themselves in that situation," said Mike Ela, DataQuick president.

The median price paid for a California home was $204,000 during the second quarter. That was up 7.4 percent from $190,000 a year ago. Last quarter's sales count was 147,513, down 3.1 percent from 152,305 for second-quarter 1999, which was the all-time high.

DataQuick, a business unit 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. The numbers count recorded Notices of Default, the first step of the formal foreclosure process.

Two-thirds of all homeowners in default are able to stop the foreclosure process by bringing their mortgage payments current, or by selling their home and paying the mortgage off. Two years ago, only half the distressed homeowners were able to do that.

With a 29.9 percent year-over-year decline, the foreclosure drop-off was strongest in the Bay Area. The Central Valley's 9.3 percent decline was the weakest, DataQuick reported.

Tulare, San Bernardino and Madera counties have the highest foreclosure rates, while Marin, Santa Cruz and Napa counties have the lowest.

Source: DataQuick Information Systems

Media Inquiries: John Karevoll (909)867-9534

Copyright © 2000 DataQuick Information Systems.
All rights reserved.

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