Foreclosures reach record high in San Diego
San Diego's distressed-property market grew substantially larger last month as mortgage defaults topped the 2,000 mark for the first time and foreclosures hit a record that was more than six times what they were a year ago.
Advertisement
DataQuick Information Systems said notices of defaults, the first step leading to foreclosure, numbered 2,071 in August. That was up from 1,573 in July and more than twice the number recorded last year, 794. The previous record was 1,596 in June. DataQuick's figures go back to 1988.
Trust-deed sales, generally involving properties foreclosed on by lenders but not necessarily sold to a new buyer, totaled 833. That was up from 641 in July, 6.2 times higher than the 134 in August 2006. The previous record of 657 was in June.
The rise in foreclosure activity in San Diego comes amid a national crisis in mortgage lending focused on the subprime sector that has sent a record number of homes into the foreclosure process.
Earlier this month, the Mortgage Bankers Association reported in its quarterly National Delinquency Survey that 5.1 percent of 44 million loans surveyed were past due. That put the national rate of loans entering the foreclosure process last quarter at the highest level in the history of the survey, which dates to 1953.
Sunday in Home: The foreclosure problem does not play out equally across the United States. DataQuick said foreclosure resales throughout Southern California accounted for 8.8 percent of all sales activity in August, up from 8.3 percent from July and 2.2 percent in August 2006.
However, the company said the generally lower-priced foreclosures do not yet seem to be having a significant marketwide effect on prices, except in more heavily impacted Riverside and San Bernardino counties and high-desert markets.
“Other indicators of market distress continue to move in different directions,” the company said in its monthly report on prices and sales. “Financing with adjustable-rate mortgages is flat (and) financing with multiple mortgages has declined significantly.”
Down payments remain at a stable level and the low rate of quick resales, known as “flipping,” and investor purchasing is unchanged.
Many buyers in high-priced areas such as San Diego made widespread use of jumbo loans – those exceeding the $417,000 conforming loan limit set for major secondary mortgage market investors Fannie Mae and Freddie Mac. But with tightening credit and underwriting standards, those are slightly less prevalent, DataQuick found.
For Southern California, the first half of August saw 43.4 percent of home loans involving jumbos, while in the second half usage was 39.7 percent.
In San Diego County, jumbos accounted for 39.1 percent of all loans in July, 38.7 percent in the first half of August and 36.1 percent in the second half of the month.
Friday, September 14, 2007
San Diego Mortgage Market Stress
Mortgage market stress will soon show up in the San Diego Real Estate sales data
Fewer homes sold last month in San Diego County than in any August in 15 years, DataQuick Information Systems reported Wednesday.
The 3,104 homes sold marked a 19.4 percent drop in sales volume from August 2006, and a 48 percent drop from the nearly 6,000 homes sold in August 2005.
But last month's drastic tightening in the mortgage market didn't yet appear significantly in August's price and sales data, like some analysts previously predicted. A drastic tightening of restrictions on who could get a mortgage for more than $417,000, the threshold for so-called jumbo mortgages, hit the nation in August.
Investors who once clamored to back the risky loans grew skittish and largely withdrew their capital in response to skyrocketing foreclosures.Many of the deals that closed in August -- and that show up in data now -- began in July or early August, before the squeeze. Still, the same trouble that has plagued the region's home sellers and overleveraged homeowners for more than a year continued last month, with acute trouble in the south and east parts of the county.
The overall median price for homes sold last month was $475,000, a 4 percent and $20,000 drop from August 2006. But with a smaller pot and different mix of homes selling, the all-home median tells a vague, incomplete story. As the sales of more expensive or larger homes draw the median upward, it tends to mask the plummeting values in some neighborhoods.
Resale detached homes sold for a median $319 per square foot last month, a 5.8 percent drop from August 2006, and a 9 percent drop from the peak for that measure in May 2006. The price-per-square-foot marker has slid gradually in the last few months, from $329 in April to $326 in May, $321 in June, and $320 in July, according to DataQuick.
"You can't paint the whole market with one brush," said DataQuick analyst Andrew LePage. "But we look at that as kind of significant. Not one of these measures is perfect, but that one's been a pretty good indicator."An incessant flood of foreclosures through much of the county demonstrates one significant effect of the mortgage crunch: many people who borrowed money for a house a few years ago can't now qualify to refinance into the kind of reasonable terms they need to hang on to their homes.
RealtyTrac reported 2,699 new foreclosure filings in July, a 139 percent increase over July 2006 and a 907 percent increase over July 2005. That firm expects to release data for August next week."It's like somebody turned off the spigot all of a sudden," said Mark Goldman, a mortgage broker and real estate finance consultant for Windsor Capital Financial Corp. "I get two to three calls a week from people who are upside-down in their houses, getting behind in their payments."There's no places for them to go for a loan; they don't have equity," he said. "There's a world of hurt out there for these people."
Analysts expect the mortgage market stress will soon show up in the sales data.The rate at which borrowers used jumbo loans dropped in the last week of August, LePage said. In the last five days of the month, 29.9 percent of all home purchase loans were jumbo, compared to 34.5 percent in the last five days of July.In the whole month of August, 33 percent of the purchase loans in the county were jumbo, down from 35.6 percent in July and January-through-July rate of 35.7 percent."It's not huge, but it may be an indication of a larger trend," LePage said. "We'll watch the September numbers very closely.
"The decline in sales volume hit hardest in resale detached homes and new homes. The former logged a 22.6 percent drop from the previous August, with 1,667 homes sold. And the 647 new homes sold last month marked a 28.5 percent drop from August 2006's rate and a 58.8 percent drop from August 2005.
Sales of resale condos also shifted slightly downward; 790 units sold, a 0.6 percent drop from the same month the previous year.Sharyn Crown, a Coronado-based real estate broker with Napolitano GMAC Realty, said her 30 years in the real estate business have taken her through several downturns and booms, but there's something different about this one.
"The market is just different because people are so nervous," she said. "The lenders are running scared and the buyers are running scared. When you have a company like Countrywide (Financial Corp., a mortgage lender) laying off thousands of people, people get nervous.Regionally, South County areas including Chula Vista, National City and San Ysidro are experiencing the most acute trouble.
That part of the county "really stands out as being hammered harder than others," LePage said.That part of the county saw a 42 percent reduction in the number of homes sold compared to August 2006, and a 9.5 percent drop in the median price for resale houses.Crown said that's also been her experience with listings in that area, and added that East County's struggling, too."The South Bay is really suffering -- it's terrible," she said. "And in the East County, sometimes a price reduction doesn't even get the house sold.
It's hard for a lot of people to get realistic when things happen like this."But the buyer pool continues to shrink with the restrictions on mortgages for more than $417,000."Yeah, a lot of people have been squeezed out with requirements for higher credit, full documentation (of income), reserves -- the stuff people should have always had," Goldman said. "The dumb money has left the market."
Fewer homes sold last month in San Diego County than in any August in 15 years, DataQuick Information Systems reported Wednesday.
The 3,104 homes sold marked a 19.4 percent drop in sales volume from August 2006, and a 48 percent drop from the nearly 6,000 homes sold in August 2005.
But last month's drastic tightening in the mortgage market didn't yet appear significantly in August's price and sales data, like some analysts previously predicted. A drastic tightening of restrictions on who could get a mortgage for more than $417,000, the threshold for so-called jumbo mortgages, hit the nation in August.
Investors who once clamored to back the risky loans grew skittish and largely withdrew their capital in response to skyrocketing foreclosures.Many of the deals that closed in August -- and that show up in data now -- began in July or early August, before the squeeze. Still, the same trouble that has plagued the region's home sellers and overleveraged homeowners for more than a year continued last month, with acute trouble in the south and east parts of the county.
The overall median price for homes sold last month was $475,000, a 4 percent and $20,000 drop from August 2006. But with a smaller pot and different mix of homes selling, the all-home median tells a vague, incomplete story. As the sales of more expensive or larger homes draw the median upward, it tends to mask the plummeting values in some neighborhoods.
Resale detached homes sold for a median $319 per square foot last month, a 5.8 percent drop from August 2006, and a 9 percent drop from the peak for that measure in May 2006. The price-per-square-foot marker has slid gradually in the last few months, from $329 in April to $326 in May, $321 in June, and $320 in July, according to DataQuick.
"You can't paint the whole market with one brush," said DataQuick analyst Andrew LePage. "But we look at that as kind of significant. Not one of these measures is perfect, but that one's been a pretty good indicator."An incessant flood of foreclosures through much of the county demonstrates one significant effect of the mortgage crunch: many people who borrowed money for a house a few years ago can't now qualify to refinance into the kind of reasonable terms they need to hang on to their homes.
RealtyTrac reported 2,699 new foreclosure filings in July, a 139 percent increase over July 2006 and a 907 percent increase over July 2005. That firm expects to release data for August next week."It's like somebody turned off the spigot all of a sudden," said Mark Goldman, a mortgage broker and real estate finance consultant for Windsor Capital Financial Corp. "I get two to three calls a week from people who are upside-down in their houses, getting behind in their payments."There's no places for them to go for a loan; they don't have equity," he said. "There's a world of hurt out there for these people."
Analysts expect the mortgage market stress will soon show up in the sales data.The rate at which borrowers used jumbo loans dropped in the last week of August, LePage said. In the last five days of the month, 29.9 percent of all home purchase loans were jumbo, compared to 34.5 percent in the last five days of July.In the whole month of August, 33 percent of the purchase loans in the county were jumbo, down from 35.6 percent in July and January-through-July rate of 35.7 percent."It's not huge, but it may be an indication of a larger trend," LePage said. "We'll watch the September numbers very closely.
"The decline in sales volume hit hardest in resale detached homes and new homes. The former logged a 22.6 percent drop from the previous August, with 1,667 homes sold. And the 647 new homes sold last month marked a 28.5 percent drop from August 2006's rate and a 58.8 percent drop from August 2005.
Sales of resale condos also shifted slightly downward; 790 units sold, a 0.6 percent drop from the same month the previous year.Sharyn Crown, a Coronado-based real estate broker with Napolitano GMAC Realty, said her 30 years in the real estate business have taken her through several downturns and booms, but there's something different about this one.
"The market is just different because people are so nervous," she said. "The lenders are running scared and the buyers are running scared. When you have a company like Countrywide (Financial Corp., a mortgage lender) laying off thousands of people, people get nervous.Regionally, South County areas including Chula Vista, National City and San Ysidro are experiencing the most acute trouble.
That part of the county "really stands out as being hammered harder than others," LePage said.That part of the county saw a 42 percent reduction in the number of homes sold compared to August 2006, and a 9.5 percent drop in the median price for resale houses.Crown said that's also been her experience with listings in that area, and added that East County's struggling, too."The South Bay is really suffering -- it's terrible," she said. "And in the East County, sometimes a price reduction doesn't even get the house sold.
It's hard for a lot of people to get realistic when things happen like this."But the buyer pool continues to shrink with the restrictions on mortgages for more than $417,000."Yeah, a lot of people have been squeezed out with requirements for higher credit, full documentation (of income), reserves -- the stuff people should have always had," Goldman said. "The dumb money has left the market."
Falling real estate prices offer 'special' opportunities
Agent: Lower prices bring lakefront views within reach
Falling real estate prices offer 'special' opportunitiesCounty median drops to $417,000-
Lower prices bring lakefront views within reach, agent saysMedian house prices in the County fell nearly 12 percent for August to $417,000, compared to $472,500 a year earlier, a real-estate tracking firm said Thursday.
Also in August, the number of houses and condominiums sold in the county fell almost 9 percent, to 138 residences from 151 residences the same month a year ago, according to figures collected from the county recorder's office by DataQuick Information Systems in San Diego.
The decline means properties with special features such as lake views and space for horses are dropping to very attractive prices for investors and for homeowners looking to move up, a real estate agent said."It's a fabulous time for buyers to buy," said Diane DiLeo of Network Real Estate in Grass Valley."Three things come together that come once or twice in a lifetime: Lower prices, great interest rates - which means lower payments - and to me, most importantly, selection. When else can you find lakefront property for under $400,000?"
In July, the county's median price stood at $429,000, and in June it was $470,000, DataQuick reported.The county median price fell faster than the statewide median in August, according to the Associated Press.The median price paid for a house in California in August was $465,000, down almost 3 percent from August 2006. The number of houses sold statewide fell nearly 35 percent in August to the lowest level for the month in 15 years.
Agent: Lower prices bring lakefront views within reach
Falling real estate prices offer 'special' opportunitiesCounty median drops to $417,000-
Lower prices bring lakefront views within reach, agent saysMedian house prices in the County fell nearly 12 percent for August to $417,000, compared to $472,500 a year earlier, a real-estate tracking firm said Thursday.
Also in August, the number of houses and condominiums sold in the county fell almost 9 percent, to 138 residences from 151 residences the same month a year ago, according to figures collected from the county recorder's office by DataQuick Information Systems in San Diego.
The decline means properties with special features such as lake views and space for horses are dropping to very attractive prices for investors and for homeowners looking to move up, a real estate agent said."It's a fabulous time for buyers to buy," said Diane DiLeo of Network Real Estate in Grass Valley."Three things come together that come once or twice in a lifetime: Lower prices, great interest rates - which means lower payments - and to me, most importantly, selection. When else can you find lakefront property for under $400,000?"
In July, the county's median price stood at $429,000, and in June it was $470,000, DataQuick reported.The county median price fell faster than the statewide median in August, according to the Associated Press.The median price paid for a house in California in August was $465,000, down almost 3 percent from August 2006. The number of houses sold statewide fell nearly 35 percent in August to the lowest level for the month in 15 years.
Subscribe to:
Posts (Atom)
