News Column

Foreclosures Down Sharply in Southern California

Jan. 24, 2013

Gregory J. Wilcox


Foreclosure activity sank to its lowest level in six years in California and the Southland during last year's fourth quarter, reflecting an improving economy, a market tracker said Wednesday.

During the October through December period, lenders issued 38,212 default notices statewide, down 37.9 percent from 61,517 a year earlier, said La Jolla-based DataQuick. Defaults also declined 22.1 percent from 49,026 in the third quarter.

Fourth quarter filings were the lowest since 37,994 issued in the fourth-quarter 2006. Defaults peaked at 135,431 in the first quarter of 2009.

"We're getting closer to the end of it, but we're not there yet," DataQuick analyst Andrew LePage said of foreclosures that have roiled the market the last part of the 2000s. "If the economy stays on the mend and home prices rise the way they did last year, then we should see foreclosures continue to fall."

For the entire year defaults fell 23.1 percent to 198,111 from 257,665 in 2011, Data Quick said.

Foreclosures in the fourth quarter fell 32.4 percent to 21,127 properties from 31,260 a year ago. That was the lowest for any quarter since the second quarter of 2007 when 17,458 homes were foreclosed.

For the entire year foreclosures fell 38.2 percent to 96,118 from 155,672 in 2011.

DataQuick's report also showed that:

-- In Los Angeles County defaults fell 34 percent in the fourth quarter to 8,100 from 12,355 a year earlier. For the full

year defaults dropped 22.6 percent to 40,175 from 51,929 in 2011. -- Fourth quarter foreclosures fell 35 percent to 3,496 properties from 5,380 a year earlier. Full-year foreclosures fell 39.3 percent to 15,424 from 25,000 in 2011. -- In San Bernardino County, fourth quarter defaults dropped 34.4 percent to 3,165 from 4,827 a year earlier. For all of 2011, defaults declined 17.3 percent to 16,682 from 20,179 a year earlier. -- Foreclosures fell 25.5 percent to 2,025 in the fourth quarter from 2,718 a year ago. For the entire year foreclosures fell 35.8 percent to 9,110 from 14,187 in 2011. -- In Riverside County, fourth quarter defaults fell 35.4 percent to 3,887 from 6,014 a year ago and for the full year they fell 20.2 percent to 20,138 from 25,240 in 2011. -- Foreclosures declined 29.3 percent in the fourth quarter to 2,400 from 3,397 a year earlier. For all of 2012 foreclosures fell 38.6 percent to 10,698 from 17,426 in 2011.

"Home values increased through most of 2012, and the rate of increase picked up toward the end of the year. That means fewer and fewer homeowners are underwater, where they owe more than their homes are worth. That in turn means they can sell and pay off the mortgage, or perhaps refinance at today's low interest rates," DataQuick president John Walsh said in a statement.

Robert Kleinhenz, chief economist at the Kyser Center for Economic Research, said that 2012 was a pivotal one for the housing market.

"Last year was a transition year for the housing market and part of that was the drop off in this foreclosure activity," he said. "All of these numbers are symptoms of an economy that is improving and a housing market that is stabilizing, and that's a welcome development."

Source: (c)2013 the Daily News (Los Angeles) Distributed by MCT Information Services

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