Friday, June 13, 2008

Still Foreclosure Central Valley

From the CVBT:

With one in every 75 Stockton area households receiving a foreclosure filing in May -- more than six times the national average – the Central Valley city leads the nation in foreclosures. For the second month in a row, California and Florida cities accounted for nine out of the top 10 metropolitan foreclosure rates among the 230 metropolitan areas tracked in the report. Seven California cities were in the top 10, led by Stockton in the top spot. Other California cities in the top 10 were Merced at No. 3, Modesto at No. 4, Riverside-San Bernardino at No. 5, Vallejo-Fairfield at No. 7, Bakersfield at No. 8, and Sacramento at No. 9.
From the Sacramento Bee:
Sales prices for existing homes are down 40 percent from their 2005 highs in Sacramento County, and similarly down 36 percent in Yolo County, 31 percent in Placer County and 25 percent in El Dorado County.

The dollar volume of homeequity loans, too, has fallen. In 2007, homeowners in the four counties borrowed $2.1 billion less than they did in 2006, according to DataQuick Information Systems. During the housing boom's peak – 2002 through 2005 – consumers in those counties collectively tapped almost $22 billion in home equity. Sometimes even those who want to spend are finding their credit lines rescinded by lenders because of falling values, says Baker of D & J Kitchens and Baths.
From the Modesto Bee:
A combination of slow sales and a desire to do something different has led Gary Robinson to close his 33-year-old business, The Yard Lumber & Fence Supply in Modesto..."The timing just kind of fits," said Robinson, who explained that though the business is viable, he didn't want to keep it going during an economic downturn, waiting for sales to improve.
The Yard has about 20 employees, down from about 70 a year and a half ago, when Robinson said he consciously chose to scale back the business.
From the Lodi News-Sentinel:
Roughly 50,000 homeowners throughout San Joaquin County — one third of the total — will receive notices next month showing what they likely already know: That their home values are in a free fall. Ken Blakemore, the county's assistant assessor, said the notices should arrive July 10. They're the largest number to show declining values in a generation, if not ever, the longtime county official said.


Anonymous said...

Does anyone know a good forum for Sacramento real estate questions?

Is it better to buy before interest rates go up or wait for the prices to drop more then buy later with higher interest?
I have a whole sell mobile home buy/rent scenario but dont think this is the right place to post it.

This blog is awesome though, I read it regularly.


Jason, have you even read this blog? Higher rates will cause prices to go even lower. Why would you buy knowing pricing will go lower? Your rate can come back down after time but there's no guarantee your home would increase in value after such a big drop.

Jacob said...

yea, if you believe home prices will fall (which I certainly do) then wait. If you think we are at the bottom and prices will not fall but interest rates will rise then buy now.

But prices are still heading down, more foreclosures and loan resets are still ahead. If interest rates go up then prices crash even harder, if interest rates go down, commodities cost continue to inflate and home prices still go down.

My advise is to wait and save as much money as you can to lower the loan amount you need. Even if rates go up, when you factor in the lower price, plus higher downpayment you will still come out ahead imo.