Sacramento Real Estate Views

Foreclosures Decline 29.5% in September in Sacramento Real Estate

California State Law Slows Foreclosure Rate in September

The rate of foreclosures slowed dramatically in September due to state intervention in the foreclosure process for homeowners in the Sacramento region and California.  The new law, SB 1137, took effect in early September, requires lenders to make contact with buyers prior to filing a notice of default.  The law which was designed with the thought that lenders would help homeowners to make loans more affordable by locking in lower or initial interest rates for 24 months or reducing the principal.  Unfortunately, the net effect is a delay in the amount of homes coming on the market for the majority and not actual help for struggling homeowners.

California’s foreclosure rate slowed 51% September over August but accounted for 27% of foreclosure activity nationwide.  If the same thing happens in California that happened in Massachusetts, California is in for an inventory increase of epic proportions.

A Flawed Plan, Good Thought But Flawed

In Massachusetts, a similar law was passed that had the same effect in June, July and August.  The foreclosure rate slowed dramatically but in September jumped 465% as the lender required 90 day waiting period had elapsed before filing a notice of default.

Unfortunately, I think it’s best if government stays out of this mess.  The last thing homeowners of Sacramento real estate need is the glut of inventory coming on the market at the wrong time of year.  “Encouraging” lenders rather than requiring them to make it work for homeowners isn’t working and probably won’t work.

If the government wants to help people who were taken in by the greed of Wall Street and lead to believe that the run up in values was sustainable, they would require lenders to take the hit not the homeowners.  In this case, the homeowner is taking the hit for being lied to and taken advantage of by a deregulated financial system.  The government bailout, while necessary, is an embarrassment to our system of government and again takes advantage of the middle class while helping out the people who caused the mess in the first place.  Ok…I’m done ranting!  (I’m getting tired of this, is it obvious?)

Stockton Is Once Again the Foreclosure Capitol of the Nation

Poor Stockton.  How much bad news can you handle?  Stockton lead the country metro areas in foreclosures with 3.69% of homes going into some stage of the foreclosure process.  Las Vegas, Nevada was a close second to Stockton at 3.48% of homes receiving a filing.

While this mess is dreadful for the majority, investors in Sacramento homes are having a field day buying up properties.  In the last week, I’ve written up 11 offers on homes in Sacramento for one investor alone.  The frenzy of the summer has passed, there are fewer multiple offer situations and with the inventory levels sure to increase with “help” from the government, the values will decline to the point where investors will surely make a bundle in the long haul.

If you’re looking to invest in real estate in the Sacramento region, please give me a call.  We have one of the largest REO/bank owned real estate teams in ReMax in the state of California and represent several hundred properties and over 30 banks.  We’re #1 in California/Hawaii division of ReMax.

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For more news on Sacramento foreclosures, see my other site Capitol City Foreclosures.com.

Source: RealtyTrac.com

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Tags: homes in sacramento, real estate sacramento, sacramento real estate, sacramento real estate agent

This entry was posted on Wednesday, October 29th, 2008 at 5:28 am and is filed under Home Sales Reports, Real Estate Market Commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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