In trying to keep my promise to post only NSDCC-related data, here’s a national article fromG-S, with NSDCC relevance at the bottom. Hat tip to Aztec for sending this along:
As of 1Q, the number of seriously delinquent federally backed loans surpassed the number held by banks and private label securitizations and now accounts for the majority of seriously delinquent mortgages (seriously delinquent mortgages comprise loans in the foreclosure process as well as loans that are 90-plus days delinquent but not yet in foreclosure).
This shift is due to the persistently elevated level of seriously delinquent loans among Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA), in contrast with private-label and bank-held loans, where serious delinquencies peaked in 2009 and have declined significantly since.
The chart below shows the number of seriously delinquent mortgages backed by federal entities and the total mortgage market; the right axis shows seriously delinquent loans as a share of the total.
Here are the recent foreclosure stats for San Diego County.
It appears that the banks/servicers have found a steady rut for their foreclosure production:
It’s hard to believe that NODs are down 15%.
It’s doubtful that they’ll deviate from the plan if it is working? They declare that they are doing more short sales in order to help people avoid foreclosure, and the government gets off their back.
These numbers look too uniform, yet nobody questions them – instead, more psycho-babble from a variety of casual observers. From sddt.com:
Foreclosure activity held steady in May, as the most prominent factor in today’s housing market appears to have settled into a comfortable monthly level.
Banks foreclosed on 1,125 homes last month, according to data provided by the San Diego County Assessor’s Office, virtually unchanged from April, when there were 1,121. It marks three straight months, and four of five this year, with the monthly total of trustee deeds — the final step in the foreclosure process — coming within 50 of 1,100.
Last month’s total is also in line with May 2010, when banks foreclosed 1,148 homes, or 2 percent more than this May.
Notices of default (NODs) — the first step in the foreclosure process, registering that a borrower is in arrears of payment — also showed little change. May saw 1,647 borrowers receive NODs, a mere 1.4 percent increase from the 1,624 in April, and an 8.3 percent decrease from the 1,798 in the year-ago month.
The only value of this data below is trying to predict how home buyers and sellers will interpret it.
Because the accuracy is suspect. For example, the ‘homes in foreclosure process’ for San Diego is more than 20% higher than the 12,561 properties shown to be in default by foreclosureradar.com. But you could also wonder about the +7.5% increase in prices too.
Sellers are happy to ignore any bad news, but how about the buyers? Does the frustration cause buyers to settle after months or years, or do they get more determined? I think there is a little of both – in my experience the buyers are holding out more for the best quality, but once they find it, they’re willing to add a little extra mustard to the price if that’s what it takes to get it over with!
The media perpetuates the idea that more foreclosures means lower prices (whether it’s true or not). But with buyers squeezing for better quality, we’ll probably continue to see the best-quality homes getting bid up, and the inferior homes getting beat down.
It’s all over the news – the housing double dip is here.
They say that the DD is caused by an overload of foreclosures dragging down prices – but they are talking about the overall national market.
Are the recent trustee sales building a backlog of REOs around San Diego?
It looks like more of the same around here – just when the servicers get some momentum, they turn off the spigot. There have only been 14 successful trustee sales in NSDCC over the last two weeks, so we’re back to the 1+ foreclosure per day.
The threat of future foreclosures is always lingering – could the worst be yet to come? With the banks and servicers controlling the flow, there doesn’t seem to be much reason to expect a flood coming anytime soon – or ever.
How many REOs are floating around in the shadows?
Here are the San Diego County properties owned by each lender, the number of SFRs they own in North San Diego County Coastal, and the count of how many of those aren’t listed yet:
REO Owner
SD All Prop
NSDCC SFR
NSDCC SFR not listed yet
Fannie Mae
1,060
4
4
Wells Fargo
377
19
3
Freddie Mac
311
2
0
Bank of NY
272
17
5
Bank of America
235
8
6
JPMChase
124
12
5
Citi
88
5
2
Totals
2,467
67
25
In the depressed areas where REOs are abundant, there’s no surprise to see some can-kicking, but around North County Coastal it’s been quiet. A few of the shadows have just been foreclosed, so you know there is some lag for evictions, repairs, and processing. Others are involved in litigation too, so it doesn’t appear that they are purposely delaying the process much around North SD County Coastal.
The buyers around NSDCC will welcome the 25 well-priced SFR REOs when they hit the open market over the next couple of months – expect bidding wars!
For the first time in years, a guy who quantifies the foreclosure crisis got to report some good news. Kyle Lundstedt’s colleagues at LPS Applied Analytics call him Dr. Doom, as he calculates all the numbers for the monthly Mortgage Monitor Report.
But this month he got to report a drop in mortgage delinquencies, down more than 11 percent month-over month, to the lowest level since 2008.
“We’re starting to see that there are a lot of folks who are still hanging in there,” says Lundstedt. “The population is a better credit quality population.”
The subprimes, Alt-A’s, the bad lending of the housing boom, have largely moved through the system already, not to mention that big banks and servicers are getting far more aggressive with loan modifications. One quarter of the loans that were more than 90 days delinquent last year are now current. That’s not to say they will all stay current, but that’s a good sign.
Unfortunately, that’s all Dr. Doom could muster on the bright side: “It’s progress; it’s not game-changing.” That’s because the foreclosure pipeline, that is loans 90+ days delinquent or in the foreclosure process, is enormous.
Foreclosure inventory is at a new all-time high. There are so many loans still waiting to go into foreclosure…in fact the total number of loans 90+ delinquent is 45 times the size of the current monthly foreclosure sale number. 45 times!
At the beginning of the year it looked like foreclosures were picking up. But those pesky lenders are teasing us again – the April foreclosures have slowed considerably.
Here are the counts of SFRs foreclosed in North SD County Coastal, YTD (La Jolla to Carlsbad):
January: 49
February: 26
March:43
April: 15
Without more foreclosed properties to sell, the inventory will continue to be bleak – homeowners with equity and lower motivation are either priced to sit, or on the sidelines.
Yet sales keep happening – consider this one that hit the market Friday at almost $500/sf:
The seller, who just got his license and is working on his first sale, did some smart things, like install a moderate line of Frigidaire stainless appliances to help disguise his original kitchen that needs a full renovation. There are plenty of windows and light, and the yard has been tastefully arranged.
But with only 2,258sf built in 1948 and just a peek ocean view from the upstairs master only, the $1,074,000 list price still sounded optimistic……and he got a full price offer on Easter Sunday!
We need more foreclosures just to add something to inventory!
From Lily Leung, the new real estate reporter for the Union-Tribune – we’re rooting for you Lily!
Fewer San Diego homeowners defaulted on their mortgages in February, and foreclosures have decreased year-over-year for the fifth consecutive time.
Could this signal meaningful progress in the county’s distressed market?
Yes and no.
“It’s hard to tell,” said Norm Miller, real estate professor at University of San Diego. “We don’t know how overwhelmed the lenders still are … or if in fact we have less (distressed) inventory … I think there’s truth in some of each.”
In February, the county recorded 1,373 mortgage defaults, the first step in the foreclosure process. That’s down 11.3 percent from January and 36.6 percent one year ago.
There were 896 foreclosures in February, down 6.6 percent from January and 7.9 percent the same time last year.
Real estate experts are mixed on what those figures mean for the county because so many factors are involved, including the “robo-signing” fiasco among banks, processing back-ups and slight job growth within the region. Another factor: Government programs that are artificially stimulating the economy and normal changes in the market.
Andrew LePage, a DataQuick analyst, said it’s too early to say if San Diego County is seeing a “downward trendline” in defaults and foreclosures. But he noted that the number of mortgage delinquencies, though historically high, have been decreasing and are starting to flatten.
“The big picture is, we’re through the worst of it,” LePage said. “If delinquencies are any indication, and that continues through next year, we may see filings go down.”
Miller, with the University of San Diego, said February’s numbers could be indicative of a slightly improving economy, but more realistically, he said, it could mean lenders are contracting less with outside companies to process documents after the robo-signing issue was revealed.
“They may be afraid to contract out services and have to do them themselves and are slower at it,” Miller said.
Others are more optimistic.
Craig Bramlett — a district manager and loan consultant at W.J. Bradley in San Diego — says he’s noticed both foreclosures and notices decrease and attributes that to a stabilizing local economy.
If both continue to fall, it could have two effects: Buyers who are looking for bargains will be driven away, or consumers who have been waiting for confirmation “that we’ve hit bottom” will jump into the market, Bramlett said.
The foreclosure numbers aren’t growing yet – we’re all convinced that they’ll be dripped out for years to come, right? The push towards loan mods and short sales enables all participants to drag out the inevitable, and it’s probably not going to change.
In San Diego County, there has been an average of 1,053 properties per month get foreclosed over the last 13 months – with an average of 764 per month going back-to-bene, and an average of 289 per month being bought by third parties:
Over the same 13 months, there has been an average of 2,716 properties per month sell on the MLS, so there has been an appetite for more than just the bank-owneds.
In North SD County Coastal, the recent detached pendings are starting to wane slightly, though the battles for the high-quality buys continue – there were six written offers on the Glaucus listing in Leucadia over the weekend, with many more interested. Here are the recent weekly new pendings from La Jolla to Carlsbad:
Week
New Pendings
LP Avg $/sf
# Already Closed
SP Avg $/sf
Feb 7-13
64
$352/sf
24
$403/sf
Feb 14-20
58
$432/sf
9
$482/sf
Feb 21-27
63
$361/sf
5
$412/sf
Feb 28-6
56
$437/sf
1
$791/sf
Mar 7-13
56
$388/sf
0
$0/sf
While there isn’t obvious evidence that prices are on the rise, it looks like last year’s $380/sf average for detached homes sold in North SD County Coastal is holding up for now.
There have been 69 detached closings in NSDCC since February 1st; their average LP-per-sf was $417/sf, and the sold average was $391/sf.
The SFR foreclosures around North SD County Coastal are still being trickled out, relatively.
We got teased with an increased flow in January when 49 got foreclosed, but in February that number was almost cut in half, down to 26 (with the same number of business days too).
Here are the foreclosed-SFR counts between Jan 1 and March 6th:
Town or Area
2009
2010
2011
Cardiff
4
5
5
Carlsbad
25
40
43
Carmel Vly
3
8
9
Del Mar
3
1
2
Encinitas
13
11
9
La Jolla
3
4
7
RSF
1
2
3
Solana Bch
4
7
3
Total
56
78
81
It’s mentioned in this video that buying a cheaper house with FHA financing might be of interest, but it is a novel concept with attractively-priced REOs. If you offered to purchase one of these with FHA financing, you’d get sent to the back of the line, behind the cash buyers, and those with big down paymnets:
