Second Mortgage Information
California Foreclosure Activity up by Biggest Margin in 14 Years
RISMEDIA, August 7, 2006(MCT)Foreclosure activity across California soared by its biggest margin in 14 years during the second quarter in response to diminishing price appreciation, but still remained well below average levels, an industry tracker said Wednesday.
And in another sign that the housing market boom is over, mortgage applications last week sank to their lowest level in four years.
During the April-through-June period, lenders sent 20,752 default notices to homeowners in the state, up 67.2 percent from the year-ago period and up 10.5 percent from the first quarter, said DataQuick Information Systems.
That's the biggest annual quarterly increase since La Jolla-based DataQuick began mining these numbers in 1992.
Activity peaked in the first quarter of 1996, when 59,897 defaults were filed and hit a low of 12,145 notices during the third quarter of 2004.
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Slow home sales drive up mortgage defaults
Mortgage defaults jumped 53 percent in Sonoma County during the second quarter as the region's real estate slowdown took hold, making it harder for homeowners in financial trouble to sell their houses. While actual foreclosures in the county still remain below historic levels, the surge is the latest sign that the eight-year housing boom is giving way to a new market where homes take longer to sell and prices have leveled off.
The increase in default notices - the largest in four years - had been anticipated as the housing market cooled.
A year ago, foreclosure activity was near all-time lows as buyers continued to snap up homes and drive up prices, making it easy for owners to sell homes quickly.
"We don't see it as all that alarming, but it's a real important trend to watch," said Andrew LePage, an analyst with DataQuick Information Services, a La Jolla-based company that released the figures Wednesday.