The latest data from real estate researcher DataQuick shows an increase in foreclosures in California, the first year-over-year increase in more than three years. Lending institutions sent default notices to 12,568 California homeowners during the July-to-September period, up 3.5% from last year’s third quarter. The last time default notices increased year-over-year was the first-quarter 2002 when the 30,225 count was up 5.2%. Defaults had previously reached a peak of 59,900 in 1996 after Southern California’s long housing price slide.
Stats from the California Association of Realtors still show strong gains in prices and sales, with the median-priced home in the state jumping 17.3% to $543,980 in September, on a sales increase of 3.9%.
I went back and looked at California sales and pricing data from the early 1990s bust and it’s very hard to define a trend from monthly data in the early stages of a downturn. Some months sales were up and prices down and vice versa. No one puts a sign on the lawn that says: “Home Prices Peaked Today.” Perusing the real estate section of the Los Angeles Times this past Sunday, I saw more homes with price reductions than I used to and others seeming (somewhat) more reasonably priced. My hunch is that California home prices peaked this past summer, but we won’t know for sure until some months down the road.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.