California Foreclosure Activity Stops Declining
August 12, 2005
La Jolla, CA.--A nine-year drop in California foreclosure
activity appeared to level off during the second quarter, the
result of a maturing real estate cycle and cooler appreciation
rates, a real estate information service reported.
Lending institutions sent default notices to 12,408 California
homeowners during the April-to-June period. That was down 14.4
percent from 14,501 for the first three months of the year, and
down 0.9 percent from 12,520 for last year's second quarter,
according to DataQuick Information Systems.
Default notices (NoDs) peaked in 1996's first quarter at
59,897. The low was last year's third quarter with 12,145.
"We have to remember that a certain level of foreclosure
activity is normal in any market. Current foreclosure rates are
unnaturally low and we expect them to go up during the rest of this
year as appreciation rates ease back," said Marshall Prentice,
DataQuick president.
The statewide median home price rose 16.7 percent during the
second quarter to $433,000 from $371,000 a year ago. The year-ago
rate of increase was 22.8 percent.
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.
Southern California saw a slight year-over-year increase in
foreclosure activity, while the Bay Area and Central Valley saw
slight decreases.
Mortgage loans are least likely to go into default in San Luis
Obispo, San Francisco and Napa counties. The likelihood is highest
in Central Valley counties.
Only about ten percent of homeowners who end up in the default
process actually lose their homes to foreclosure. Most are able to
stop the foreclosure process by bringing their mortgage payments
current, or by selling their home and paying home loan(s) off.
While foreclosure properties tugged property values down by
almost ten percent in some areas nine years ago, the effect on
today's market is negligible, DataQuick reported.
Source: DataQuick Information Systems
Media Inquiries: John Karevoll (909)867-9534