DataQuick: Sacramento Unsold Repo Inventory Increasing

From Bloomberg:

Home prices fell in four out of every five U.S. cities in the third quarter, a record spurred by distressed foreclosure sales across the country. The median price of a U.S. home declined 9 percent from a year earlier....

The steepest price declines were all in California. The area surrounding San Bernardino had a 39 percent fall in its median home price to $227,200. Sacramento saw a 37 percent decline to $212,000, and San Diego had a 36 percent drop to $377,300. The U.S. median is $200,500.

From CNN Money:

"We're clearly seeing a broadening, as well as a deepening of the declines," [Mike] Larson [a real estate analyst at Weiss Research] said. "That indicates we've moved past the time when price drops were fed by bursting of real estate bubbles to one in which the broad economic downturn, marked by job losses, is taking hold."

From the Sacramento Business Journal:

Homebuyers snatched up repossessed homes at an impressive clip this year, but that doesn’t mean the Sacramento region’s housing troubles are easing. That’s because lenders might be foreclosing on homes faster than they can sell them.
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[T]he inventory of foreclosed homes isn’t dropping. The backlog of unsold repossessed homes has actually grown in the past year, to about 5,000. That number includes homes repossessed over a two-year span prior to Aug. 1 that didn’t sell by Oct. 20 (allowing a reasonable period to spruce up and market them for sale). The backlog has increased from about 3,300 at the same time last year, DataQuick said.
...
Not all repossessed homes make it quickly to market. Only about 3,100 foreclosed homes were listed for sale through MetroList as of the end of October, even though the backlog of unsold foreclosures is 5,081 homes. Those homes will eventually make their way to the market.
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At least one national bank is looking to rent some of its repossessed homes rather than sell them. HomePointe Property Management, a Sacramento company that typically manages rental properties, just signed a contract to rent out “a handful” of foreclosed properties throughout the region.

From the Sacramento Bee (hat tip patient renter):

Sacramento County's lowest-income neighborhoods continue to take the toughest, most destabilizing punches of the region's two-year foreclosure crisis, says a new report from the Sacramento Housing and Redevelopment Agency. And it's getting worse. "Foreclosures are continuing to increase," said Joel Riphagen, SHRA redevelopment analyst.
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Now, many of the region's lowest-income neighborhoods have seen huge spikes in sales as home prices have fallen. Investors are snapping up homes formerly occupied by owners with intent of renting them.

From the Sacramento Business Journal:

I think they [lenders] had continued to underestimate the problem up until very recently. The other part of it is, I go in with a reasonable approach. What I’m hearing from people I know at lending institutions is that the number of people asking for modifications, some sort of help, is somewhere around 80 percent of their customers, but the number of people who actually qualify for that help is closer to 30 to 35 percent.
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Some people with a fixed-rate mortgage read about modifications being available, so they would like to see their interest rate modified downward. There’s not much the bank can do for those people.

From the CVBT:

Residents of the Central Valley are frustrated and angry that so little impact has been seen from the Wall Street bailout, says U.S. Rep. Dennis Cardoza, D-Merced, who is criticizing Treasury Secretary Henry Paulson of foot dragging.
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Mr. Cardoza says he “reluctantly” supported the $700 billion banker bailout only after guarantees were included in the legislation that taxpayers would be protected and the foreclosure crisis would be averted.

From the CVBT:

The thousands of homes lost to foreclosure and the resulting depression of home prices are beginning to make California bit more affordable...The Sacramento region and Stanislaus County were the second- and third most-affordable metro areas in California with 59.9 percent and 59.7 percent affordability, respectively.
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The building industry argues that today’s relatively high affordability levels are likely to be a short-lived phenomenon after the market correction is completed as underlying demographic trends point to rising prices in the future once the large supply of foreclosed homes is sold. “The increase in affordability is great news for people who are looking and who qualify to buy a home in the current market, and we definitely encourage those people to do so and take advantage of the low prices while they last,” says Robert Rivinius, CBIA’s president and CEO.

From the Sacramento Business Journal:

The rough and tumble economy did not spare Sacramento-area banks in the third quarter despite the more cautious nature of community-owned banks. Only three of 11 area banks earned more through the first three quarters of the year than they did during the same nine-month period in 2007...In the aggregate, locally based banks earned $12.9 million through the first nine months, down 52.6 percent from earnings for the same period last year.
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In a normal market, people pay off a home-equity loan because they could otherwise lose their home. In the current market, people have already lost their home, and there is little or nothing for the bank that made the equity loan to recover.

From the Manteca Bulletin:

Closing schools to weather the deepening budget crisis is among 100 ideas being scrutinized by Manteca Unified...The double whammy of declining enrollment due to the foreclosure crisis coupled with the state's mid-year deficit projection that has ballooned to $28 billion has opened the door to such a move.

From CBS13:

No too long ago, Elk Grove was booming with growth. In fact, it was fastest growing city in the country at one time. Tonight, it's forced to pay the price for the nation's faltering economy. The city took a big hit today with another dealership closure. Customers who bought at Elk Grove Saturn came back for a tune-up today to find their dealership closed.

From the Sacramento Bee:

AAA said gas fell another penny in Sacramento on Monday to $2.24 a gallon, the cheapest it's been since May 2004...If prices hold, that translates into savings of more than $2.5 billion a month across the state. But that's more than offset by the fallout from the housing crash. So-called "equity extractions" in California – the dollars generated by home equity loans, refinancing or outright sales – have fallen by $41 billion this year, according to researcher MDA DataQuick.

Not surprisingly, Californians aren't suddenly reopening their wallets. "We're doing the same things that we did when gas was almost $5," said Marty Walter of Orangevale during a stop at a Union 76 station in Roseville on Monday. "We're getting into the pattern of saving – let's not do anything unless we have to." Cori Brown, pumping $15 worth of fuel into her 1996 Ford Explorer at a Chevron station on Richards Boulevard, feels the pinch. Until food and rent decline as much as gas, "it doesn't make a whole lot of difference," she said. "This is a depression, and I'm living through it."