Sacramento Mortgage Delinquency Rate Approaches 7%
From the Sacramento Bee:
6.8 percent...of residential mortgages in El Dorado, Placer, Sacramento and Yolo counties were three months or more behind on payments in October, First American CoreLogic reported Tuesday...That compared with 4.3 percent in October 2007.From the Sacramento Bee:
Times are hard all over, and it's making things easier for crooks. Lean budgets have prompted Sacramento city officials to cut the Police Department budget by 8 percent, and the county has made cuts in probation and other programs aimed at keeping offenders off the streets. Some neighborhoods aren't willing to sit back and hope for the best.From newswithviews.com:
...
To stem crime, the homeowners association for the sprawling, 8-year-old Natomas Park development hired Paladin Security. The community has endured robberies, shootings and home invasions..."Providing safety is at the top of the list for us," said [HOA president Robert] Thompson. "The basic tenet of the homeowners association is to preserve the property values. Nothing affects property value like crime."
Back in 2005, I told my husband we have to sell our home in Sacramento and get out because the housing market was going to crash. While I was planning to get packed up and put the house on the market, John was diagnosed with cancer so we had to push back our plans a bit. We purchased this house in West Texas in April, 2006 and sold our house in Natomas Park, Sacramento, California, several months later. We were one of the lucky ones who got out.From the Sacramento Bee:
While we had no debt on our home except the original mortgage, I knew the hurricane was building steam and sure as the sun shines, it has hit Natomas Park hard. The house across the street from ours, same floor plan except flipped, sold for $405,000 in June 2005. Today that house is appraised at $274,000. The house we sold is worth $150,000 less today than the day we signed the final escrow papers. Those buyers are saddled with huge mortgages that far exceed the value of the homes in that foreclosure capital and it will never turn around for them. The property will continue to age and eventually new houses in the area will be built commanding higher selling prices than the used ones.
Another car dealer has folded in the region, and it's becoming increasingly clear that a government bailout for the U.S. automakers would translate into even fewer dealerships in places like Sacramento. Auburn Buick Pontiac GMC on Monday became the 14th dealer in the greater Sacramento region to close this year, and the third in Auburn.From Reuters:
...
Steve Snyder, who owns Gold Rush Chevrolet Subaru in Auburn, said fewer dealers probably makes sense. "I think a flushing-out is necessary," said Snyder, a regional vice president with the California New Car Dealers Association. But he added, "It would make me uncomfortable if I'm the one who's going to go out." His sales volume has dropped 60 percent this year.
The chief executive of American Express Co said on Wednesday that the current financial downturn is strongly affecting the spending of people in high income levels, a departure from prior economic slowdowns. "It's very different from the last two downturns," Kenneth Chenault said during the Fortune 500 Forum. "The impact on spending has been very strong ... across a range of income levels and high income levels."
12 comments:
Sacramento Mortgage Delinquency Rate Approaches 7%
Sure, with all the programs and free money and loan mods for people in default there is more incentive to default.
If only about 5% of homes are in default, that means 95% are not. If the programs for deliquencies become attractive enough then more of the people current will have incentive to become delinquent.
Anyone who has accepted the fact that prices will not rebound anytime in the next five to seven years has all the incentive they need to walk away from a home that they are several hundred thousand dollars upside-down on. Only those who still believe that we will soon rebound and prices will go back to 2005 levels have any incentive to hang onto an underwater position. When/if the media finally start spreading the word that 2005 is NEVER coming back; the jingle mail floodgates will truly be opened.
Jobless claims for November come in at 533,000. Not since '70's have we seen a number like this one and the collateral damage will hit us here and continue to pressure foreclosure rates upward. The November report is probably not the worst of what we'll see in coming months as the auto sector will surely deliver huge losses in the future. I wouldn't be surprised to see the foreclosure rate mirror the unemployment rate as we move forward. And an unemployment rate of 10% + is entirely possible when one considers past recessions and job loss impacts.
Sacramento will see more than it's fair share of unemployment as the state and local governments crack under budget pressures.
What's interesting to me is that the aggregate of inflation protected Treasuries is pointing to 1% inflation over the next 10 years. That's tough to swallow unless one believe that we will enter a depression and stay there for a decade or more.
Home loan troubles break records again
http://news.yahoo.com/s/ap/20081205/ap_on_bi_ge/home_foreclosures_4
"A record one in 10 American homeowners with a mortgage were either at least a month behind on their payments or in foreclosure at the end of September as the source of housing market pressure shifted to the crumbling U.S. economy."
Hmmmm...if our delinquency rate is approaching 7% and the article above says nationally its about 10%, wouldn't you think that being so close foreclosure "ground zero" our delinquency rates would be higher than 10%?
When/if the media finally start spreading the word that 2005 is NEVER coming back
I doubt they would. When it comes to markets/the economy, the media are eternal optimists.
I heard a piece on NPR last night talking about the Peter Schiff youtube phenomenon, how he was bashed on TV over and over during the last few years and ended up being right about almost everything. Then as the piece is coming to a close they mention a few of Peter's current predictions (which are still dire), and what do they do? They bash him.
It actually reminded me of a situation during the Pres. campaign when NPR addressed an accusation that they were participating in a media blackout of one of the candidates, following a report from the Project for Excellence in Journalism which concluded as much. NPR defended itself saying they go through great pains to be fair and balanced, etc., then closed the piece by saying that the candidate in question was not viable anyways, seemingly excusing the behavior they had just denied.
Bias abounds.
Lander - no December watercooler? My anecdotes would be better placed there :)
That 533000 is just the first estimate for November.
What will be scary are the numbers for Jan and Feb. That's when the majority of the people will hit the rolls since they are being told 12/31 is their last day. These are folks in the tech industry who work as contractors, many have been with clients for almost 2 years.
Add to that the retail losses and it's ugly. I'm going to be ready with some hot tea, blankets, and plenty of couch and floor space.
"Add to that the retail losses and it's ugly."
Retail uses this Christmas season as a last gasp. Not only will there be job losses, BK will probably fall upon many retailers. Way too much overkill in that space...
PR...you are so right regarding the media...
As one author I read puts it:
"They obscure not to keep people from panicking because they know too much… but rather to manage the information in such a way that the herd moves only into the chute that is thought to best serve the their purposes."
Diggin: Here is why the numbers appear inconsistent: The original post was quoting 6.8% locally, for mortgages 90 days or more delinquent. The 10% nationwide number is for mortgages 30 days or more delinquent.
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