From Schahrzad Berkland - California Housing Forecast
The foreclosure tsunami is a fact. The rate of Notices of Default (NODs) turning into bank owned properties (REOs) has risen from jsut a few percent, to 20% in October, to 50% now, and is sure to rise even more. NODs are just skyrocketing, and REOs are making up more and more of all real estate transfers. REOs are making up 50% - 58% of all sales in 3 of our southern CA counties (see table below).
The banks are hiding over 4000 REOs, but eventually those will hit the market. I doubt they intend to keep thousands of vacant homes on the market, because vacant homes are hard (if not impossible) to insure, invite vandalism, and cost money to maintain without bringing money in.
Data from Dataquick and ForeclosureRadar.com for January 2008 - April 2008 shows Ventura County is the most unhealty market, with 58% of all sales made of up homes going back to the bank at auction. The most healthy market among the southern CA markets that I track, is Orange County, where REOs are only 34% of all sales.
REOs as percent
County NOD REO (sale to bank) regular sales of all sales
Los Angeles 31,066 11,295 16,145 41%
Orange 9,786 3,327 6,586 34%
Riverside 20,446 9,919 9,963 50%
San Bernardino 15,720 6,809 5,554 55%
San Diego 13,000 5,500 8,697 39%
Ventura 1,253 3,047 2,238 58%
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