From Lily at the U-T:
Foreclosures are inching up again, while closely watched defaults shot up 34 percent in March — the largest monthly increase for San Diego County in more than two years.
Analysts at DataQuick Information Systems on Tuesday reported there were 1,837 mortgage defaults in March, up 34 percent from February but down 19 percent from a year ago.
The company’s numbers also show there were 1,047 foreclosures in March, a 17 percent increase from February but an 8 percent decrease from the same time last year.
Some industry leaders predict monthly numbers will continue to rise this year as banks are apparently becoming more expedient with foreclosure processes and people continue to walk away from their homes, even when they’re able to afford the mortgage payments.
March’s monthly increases may indicate that lenders are becoming “more comfortable going forward with notices of defaults,” said Dave McDonald, a branch manager for New American Funding in Bonita and a past president of the California Association of Mortgage Brokers’s San Diego chapter.
Another factor that could lead to more defaults: homeowners who took on five- and seven-year adjustable rate mortgages, or ARMs, during the height of the market. McDonald said those consumers are expecting drastic changes in their loan terms this year and in 2012, which could mean increases in monthly payments. In the past, he’s seen them go as high as $800 more a month for some homeowners.
Since refinancing is an unlikely option, McDonald suspects many will end up defaulting on their loans. “It’s the next wave (of defaulters,)” McDonald said.
Gary Laturno, a San Diego real estate broker whose expertise is in foreclosures, is still in the wait-and-see category with foreclosures and defaults this year.
Still, Laturno concedes the state of the county’s distressed market is volatile. He’s still seeing a number of “strategic defaulters,” homeowners who walk away from their homes because they are so underwater, even when they can afford to make the payments.
“I think we have a long way to go” before the distress is over, said Laturno, also a San Diego attorney.
I am a proponent of getting this over with – and support banks and servicers pushing through more foreclosures. It is inevitable, let’s take our medicine!
At the end of the last video I said that more REO listings would be good for pricing overall, and somebody on CR questioned tha reasoning.
Buyers like REO pricing, which tends to be much sharper than with elective sellers.
Those who have their house on the market today (unsold) only knows what price isn’t working. If there were more REOs, it would be easier for them to see where the actual pricing needs to be.
I think you’re reaching there. But one good thing about REOs is that you don’t emotional sellers involved.
On the medicine thing, maybe you should think of it like chemo. It’s a harsh medicine, and too much at one time will kill you as much as the underlying disease. The objective is to have the optimal amount of medicine over time.
Chemo isn’t the right analogy IMHO.
More like a gangrenous limb. You need to amputate it, not mask the pain with morphine while it spreads to the rest of the body.
If we are using metaphors, I think we are talking stuffed up toilets. Plunge, flush, and clear.
Jim the Plumber time!
REO’s tend to bring the asking price to the buyers bid. The good thing about today’s market is there’s buyers with bids out there. It’s not a bidless market in danger of crashing. 2007-2008 the buyers were completely exhausted and there were none out there. Now we have buyers ready to buy, but a lack of sellers willing to meet them at market prices.
Data like this only confirms what everyone has noticed. Slow sales with slowly bleeding prices. It only makes buying decisions harder. Oh well potential buyers won’t miss any actions if they wait another year or two. The standoff continues.
You guy’s realize that if there start to be a lot of foreclosures hitting the market, That in the absents of some external pressure the voluntary listing will just disappear right?
I mean you really just end up with a market of foreclosures. That can be a really ugly market for most first time home buyers, unless they have a lot of cash and really know how to fix stuff,
Oh well flipper heaven
“Gangrene?” “Chemo?” Really?
http://www.psychwiki.com/wiki/Dehumanization
2.I think you’re reaching there.
Stats for North SD County Coastal detached:
There are 1,482 active listings, avg $578/sf
There were 224 sold in last 30 days, avg $375/sf
6.6 months’ worth of inventory.
642 SFRs on the NOD and NOT list.
Roughly 1,300-1,400 of the 1,482 actives are overpriced.
Buyers would love to have another 642 listings to consider, bring them on! If there were more attractively-priced properties popping off the market, it would greatly assist with market clearing and price discovery.
the voluntary listing will just disappear right?
I’ve been surprised at how many elective sellers have chosen to sell in the last 3-4 years.
People sell when they need to sell. Long-time owners are getting up in age, and they can still sell for far more than they paid. Off they go to the retirement home, or in with the kids.
end up with a market of foreclosures.
We can only hope.
It’s not only because they are attractively-priced, but the easy access is very helpful (vs. lowly-motivated short sellers) and they create the ideal auction-type format when they let offers come in for 3-7 days before selecting a winner.
These are conditions that buyers would appreciate greatly.