Three California Counties Top Foreclosure List in August, 2019
Despite predictions of an imminent crash, the real estate market continued to chug along at a break-even pace throughout most of the United States as the summer of 2019 drew to a close. All the predictors that worry analysts — high prices, growing inventory, wage stagnation — continue to be in play. But with mortgage prices trending lower, an uncertain equilibrium has emerged. Some local markets favor sellers; others, like formally red-hot Austin and Denver, have officially become buyer’s markets.
Foreclosure filings reflect this calm before the storm scenario. Foreclosures increased four percent in August, representing a total of 53,007 properties — i.e., there was one foreclosure for every 2,554 properties nationwide — but one needs to put that slight uptick into perspective. There are 24 percent fewer foreclosures nationwide over the previous year, continuing a downward trend in the real estate market that has lasted the entire decade.
Of course, there are always outliners to the prevailing trend.
The states with the worst foreclosure rates this month were:
- Delaware (one in every 1,106 units)
- New Jersey (one in 1,192)
- Maryland (one in 1,218)
- Illinois (one in 1,562)
- Florida (one in 1,633)
Among metro areas: Jacksonville (one in every 1,043 units), Baltimore (one in 1,116), Chicago (one in 1,379), and Philadelphia (one in 1,422) all had more foreclosures than the national average.
The State of California & the Real Estate Market
California, like other hot seller’s markets, has shifted into neutral. Price gains throughout Southern California, for instance, are modest, compared to recent years when available properties “flew off the market after aggressive bidding wars and the median consistently rose by mid- to high single digits or more,” writes Andrew Khouri in the Los Angeles Times.
For the most part, foreclosures are low across the state. The total number of foreclosures is one in every 2,932, slightly lower than the national average. State-wide, pre-foreclosure is down 2.8 percent over the previous month; however, there is a slight uptick in auction sales (2.5 percent) and REOs (8.4 percent). The latter figures are significant, considering that both auction sales and REOs were far lower the year before. Bank owned properties alone, for instance, were down 42.2 percent in August 2018.
Five counties in the state top the state foreclosure rate:
- Kern (one in every 1,254 units)
- Shasta (one in 1,372)
- Madera (one in 1,391), Siskiyou (one in 1,415)
- San Bernardino (one in 1,531)
In addition to San Bernardino, the populous southern counties of Riverside (one in 1,624) and Palm Beach (one in 1,749) are posting larger than average numbers of foreclosures.
These counties may reflect a tipping point in the California real estate market, which could indicate an increase in defaults in 2020. Despite downward trends in foreclosures, investors shouldn’t become complacent. Keep a close eye on your portfolios for late payments and be proactive in mitigating losses. To stay up to date with housing market trends, predictions, and news, check-in with us at the Peak Corporate Network.