Sacramento Real Estate Views

Notices Up, Sales of Foreclosures Down

Government Intervention Slows Foreclosure Process

ForeclosureRadar.com reported yesterday that notices of default, the first stage of the foreclosure process, are up 26% higher than the peak of April of 2008.  Notices of trustee sale rose over 82% over the peak in July of 2008.  Yet, sales of foreclosed homes at auction has decreased over 41%!

The report cites the State of California has significantly impacted the process and is creating havoc in the Sacramento, as well as other, real estate markets throughout the state.  The large disparity between filings and sales points to significant delays but not prevention of the foreclosure process.

What good is this doing?  Help me out here, I’m not seeing it!

The Black Hole

The result is that many, many homes in our region sit empty and are not on the market for sale.  This is skewing the market numbers throughout the region.  If the properties, ready for market, were put up for sale, the inventory, average sales price and number of units sold statistics would all be different than they currently are.

As long as the foreclosure crisis continues and homes continue to be lost but not put back on the market for sale, all numbers pertaining to the market performance will not be entirely accurate as they are being artificially manipulated by other than market forces.

So?

While this may not seem to be a big deal, all market analysis of a given home in a given neighborhood could be completely wrong.  While accurate for right now, in this moment, they will be not be accurate if these homes come on the market suddenly instead of being trickled out a little at a time.  Honestly, my opinion is that this is what the banks will be forced to do in the coming year; trickle these properties out a little at a time, sell them in bulk or at auction.

Releasing all of these homes at once would not be a good thing on one hand but on another, I’m working with several people who would be thrilled to see it!

Thanks for visiting!

Related posts:

1. The Foreclosure Crisis Is Ending
2. First Quarter Home Sales Decline
3. Total Number of Homes for Sales Increases

Tags: sacramento foreclosure

This entry was posted on Wednesday, April 15th, 2009 at 5:20 am and is filed under Local Real Estate Info, 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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