California saw a 19 percent increase in the number of bank owned properties between July and September compared to the previous three months. Analysts say lenders are speeding up the pace of clearing out distressed inventory.
“Especially now that home prices have risen so much, lenders are much more motivated to start finalizing some of the foreclosures that have been delayed.”
Daren Blomquist is with the research firm RealtyTrac which released its third quarter numbers today. Despite the quarter-to-quarter increase, bank-owned properties are down nearly 70 percent from Q3 of last year.
Meanwhile, overall foreclosure activity in September was down nearly 60 percent from a year ago. About 15,000 properties received foreclosure filings last month. Blomquist points out, that’s double the number seen before the housing bubble burst.
“Probably by the third quarter of next year, a year from now, we’ll be seeing the numbers in California likely right about down to that pre-housing crisis level.”
In the Sacramento area, the number of Real Estate Owned or REO homes has skyrocketed. From August to September, REOs jumped by 70 percent, says Blomquist.
"That is a sign that lenders I think are becoming more willing and more motivated with the rising home prices to go ahead and finalize their foreclosures and take these homes back and then eventually go ahead and resell them."
Blomquist says the silver-lining of that is more homes on the market and more opportunity for buyers to find something they can afford. Overall foreclosures in Sacramento County, which also includes "notices of default" and "auction sales," are down by 56 percent from this time last year.
In Stockton, there were 347 properties with foreclosure filings in September. That was down 24 percent from the previous month and 69 percent from a year ago. REOs were down in Stockton by 10 percent month over month.