Thursday, March 12, 2009

700k!

700k, that's not a price. That's the estimate of how many foreclosed homes lenders own and don't have on the market yet, the so called "phantom inventory" we keep hearing about. That's a crap load of homes. I'd bet at least 40% of those are in California.

Lots of foreclosure news this week, none of it good. Yesterday I posted that Riverside was up a little from Jan to Feb. LA county has us beat like a drum. Up nearly 70% from Jan to Feb.

A total of 3,921 foreclosures were reported in February, up from 2,314 the previous month, the real estate information provider reported. In February, 9,228 notices of default were issued, a 47 percent increase over the 6,286 issued the previous month.



This came from a Bloomberg story on foreclosures.

Foreclosure filings in the U.S. climbed 30 percent in February from a year earlier as the worsening economy thwarted efforts by the government and lenders to prevent homeowners from losing property, RealtyTrac Inc. said.

A total of 290,631 homes received a default or auction notice or were seized by the lender, the Irvine, California-based seller of default data said in a statement today. Properties that got a foreclosure filing for the first time totaled 161,976, the highest in RealtyTrac records dating to January 2005.

Some of the top U.S. lenders own as many as 700,000 foreclosed homes they have yet to offer for sale, said Rick Sharga, executive vice president for marketing for RealtyTrac.

The banks may be waiting to see how U.S. government plans develop before selling the properties, Sharga said. The lenders and government-owned Fannie Mae and Freddie Mac, the two biggest U.S. mortgage financing companies, have already extended temporary foreclosure moratoriums.

One in 440 U.S. housing units received a foreclosure filing last month, and Nevada, Arizona and California had the highest foreclosure rates, RealtyTrac said. The February total was the third-highest on record. Filings rose 6 percent from January. New foreclosures rose 8 percent from 150,432 in January.

California had the highest total with 80,775 foreclosure filings in February, a 51 percent increase from a year earlier. Auction sale notices almost tripled to 18,831.

3 comments:

Anonymous said...

Hi all,

Here's an interesting one for you.

An analysis of the current economic crisis we are all unfortunately facing but looked at from a slightly different perspective.

This analysis looks at past banking crises and how they have effected various aspects of the economy.

It is titled The Banking Crisis - Where are we now? (follow the link should you be interested) and has particularly interesting points about how the previous banking crises has effected assets including property prices.

Oldtimer said...

Count me as a skeptic to the 700K shadow inventory number.

If 40% of 700K homes that were foreclosed and not on the market were in CA, that would be 280K homes. According to realtytrac's own stats, trustee sales have been running at a max of 20K per month. That would mean at least 14 months of properties have yet to be put up for sale, even though we are seeing REOs sold left and right.

I'm not sure where the disconnect is, but those numbers don't add up.

golfer_X said...

The 40% was just a sarcastic quip by me. The 700k is a estimate of the total in the US. They made no mention of how many were where.

In California there were something like 250k foreclosures last year (go easy on my I'm going from memory here). No telling how many the banks are holding. I know one small tract I look at regularly has probably a dozen or more foreclosed homes that are not on the market and have been bank owned for months. I would think with the current pace of sales the banks would want to get the stuff listed quickly and get it sold. We are moving into the spring selling season. I'm sure they don't want to miss this spring. There are only so many knife catchers out there.