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No New Foreclosure Wave in Sight for California: Report
Posted By Carrie Bay On August 13, 2010 @ 3:02 pm In Foreclosure,Loss Mitigation,Market Studies,REO | No Comments
Foreclosure activity in California was again mixed last month, according to a locally based firm that tracks every foreclosure action in the state, ""ForeclosureRadar"":http://www.foreclosureradar.com.
[IMAGE] The companyÃ¢â‚¬â„¢s latest California market report shows that foreclosure filings and cancellations dropped in July after rising the month before, while foreclosure sales rose after falling the month prior. But even with the up-and-down wave of indicators and some analysts predicting another setback in housing, ForecloureRadar says it doesnÃ¢â‚¬â„¢t expect the foreclosure picture in the Golden State to worsen.
Sean OÃ¢â‚¬â„¢Toole, founder and CEO of ForeclosureRadar, said, Ã¢â‚¬Å“We continue to hear a lot of concern about a double dip for housing, combined with increasing concern that another wave of foreclosures is coming as well. We see no evidence of a foreclosure wave anytime soon.Ã¢â‚¬Â
OÃ¢â‚¬â„¢Toole explained that if another foreclosure tsunami were about to hit California, there would be evidence of it in the numbers, months before those homes actually hit the market.
He agrees that there is a huge Ã¢â‚¬Å“shadow inventoryÃ¢â‚¬Â of homes that are delinquent in their mortgage payments, but those homes have a long path ahead to make it through the entire foreclosure process before hitting the market as REO listings.[COLUMN_BREAK]
ForeclosureRadarÃ¢â‚¬â„¢s market research shows that the time duration of the foreclosure process in California, from the filing of the notice of default to the sale of the property at trustee auction has lengthened to an average of 226 days.
OÃ¢â‚¬â„¢Toole says even if those properties already in foreclosure and currently scheduled for sale were pushed to the end of the pipeline, rather than postponing or canceling, it still takes lenders on average 269 days to resell those homes after the foreclosure sale occurs.
Ã¢â‚¬Å“Bottom line - we aren't ruling out a double dip for housing, but at least in California it certainly won't be caused by an excess supply of foreclosures anytime soon,Ã¢â‚¬Â OÃ¢â‚¬â„¢Toole said.
According to ""ForeclosureRadarÃ¢â‚¬â„¢s July report"":http://files.foreclosureradar.com/foreclosure-report/July+2010+CA+Foreclosure+Report.pdf, notices of default dipped 4.82 percent compared to the previous month and were down an incredible 47.09 percent from a year earlier. Notices of trustee sale declined 18.91 percent between June and July.
Foreclosure cancellations were down too, though Ã¢â‚¬" 13.75 percent from the previous month. Lenders took back 13.46 percent more foreclosed homes in July than they did in June. However, the stateÃ¢â‚¬â„¢s total REO inventory declined to 81,536 properties as of the end of July, based on ForeclosureRadarÃ¢â‚¬â„¢s market data.
The discount from the market value at which third parties, typically investors, were able to purchase properties at trustee sale, varied by county.
Orange County saw the toughest competition on the courthouse steps, with discounts from market value of just 15.3 percent, according to ForeclosureRadar. Kern and Fresno Counties offered the largest discounts at 29.3 and 29.9 percent, respectively. Statewide the average discount for a home bought at foreclosure auction was 21.6 percent.
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