Sales from California Foreclosed Home Listings Rose 32%
Sales from foreclosed home listings in California increased by 31.9 percent in May, according to a study of foreclosures and foreclosure auctions in California.
The May increase followed April’s increase which posted a rise of 35 percent compared to March sales.
The number of trustee sale notices also increased by 42 percent from April, prompting analysts to expect another increase in sales of units from foreclosed home listings in the coming weeks and months. In reaction to these increases, many lenders have been postponing their foreclosure sales to prevent another drastic decline in prices.
While trustee sale notices increased in May, default notices dropped by 4.2 percent to 40,870 notices compared to April filings and dropped by 3.1 percent compared to May 2008.
Trustee sale filings increased to a record high of 41,959 filings, an increase of 42 percent compared to April and an increase of 24.1 percent compared to May 2008. Total filings were also 7.6 percent higher than the record peak reached in July 2008.
Meanwhile, the number of houses included in foreclosed home listings and sold at auctions reached 17,871 units, an increase of nearly 32 percent compared to April. Although the total is 30 percent lower than foreclosure auction sales levels in May 2008, the number is still significant, as the number represented $8.01 billion in mortgage values.
Of the huge $8.01 billion total in loan values, an overwhelming 83 percent of the total loan values of properties in foreclosure auctions had opening bids of only 58.6 percent of the loan values.
In addition, nearly 88 percent of properties in foreclosed home listings that were offered at auctions were repossessed by lenders. This percentage translated to 15,599 units and represented $6.98 billion in total loan values.
Purchases by investors and other third-parties from foreclosure listings reached 2,272 units, a rise of 39 percent from April and an overwhelming increase of 228.3 percent compared to May last year.
More than 50 percent of third-party purchases of foreclosures occurred in only five counties: San Diego, Los Angeles, Riverside, Orange and Sacramento.
The study also reported that out of the 111,824 properties in foreclosed home listings in May, only 15.9 percent were sold, a decline compared to the 49.2 percent share in May 2008.
A positive news item for homeowners is that 40 percent of mortgages already scheduled to be added to foreclosed home listings in June and in the following months have been held back to make way for negotiations between lenders and borrowers.
