(Source: By Eric Grunder, The Record, Stockton, Calif. (MCT) – Stockton has again become the nation’s No. 1 foreclosure market.
RealtyTrac, which monitors foreclosures nationwide, said Stockton had a higher foreclosure rate than any other metro area in the U.S. in the first half of 2012.
About 2.7 percent of homes – one of every 38 – received some sort of foreclosure filing from January to June. That is more than triple the national rate of 0.8 percent.
The weak real estate market – a large part of it foreclosures – has had a part in Stockton’s bankruptcy. As home prices slid from their peak in 2007, so did property tax revenue, a major income source for the city.
San Bernardino, which has filed for bankruptcy, also blamed falling property tax revenue partially for its financial problems.
Across San Joaquin County, one in every 144 homes received a foreclosure notice in June, according to RealtyTrac.
Meanwhile, the California Association of Realtors reported that in June, 61 percent of all homes sold in San Joaquin County – not including new homes – were so-called distressed home sales, foreclosures, short sales and the like. Statewide, about 42 percent of all sales are distressed.
The latest reports are just another indication that the real estate market is throwing off mixed signals.
Earlier this week, Seattle-based Zillow said some areas of San Joaquin County are showing price increases, especially in the southeastern part that includes Tracy as well as the 95207 ZIP code area of Stockton.
And last week, DataQuick, a San Diego-based real estate information company, said home prices in the state’s most affluent areas – mostly along the coast – are rising even as foreclosures are declining.
Price pressure in the Bay Area was a major factor in the rise in prices in San Joaquin County until the bubble burst. With prices again rising west of the Altamont Pass, some buyers are venturing into this county.
One agent reported listing a Tracy home Saturday and receiving 16 offers, one of them for cash, many for more than the list price and most from Bay Area buyers.
Even the new RealtyTrac foreclosure report contained a glimmer of encouraging news: Nine of the 10 cities with the highest rates saw rates drop year over year, including Stockton’s rate, which fell 3.2 percent from the first half of 2011.
“I love the market now,” said Lela Nelson, who’s been selling homes in Stockton for 34 years. “The people in Stockton are buying, and the people in Stockton are selling.”
Foreclosures, however, remain a major factor in real estate, especially in California. Led by Stockton, seven of the top 10 metro areas with the highest rates of new foreclosures in the first six months of 2012 are in California – Modesto, Merced, Bakersfield, Visalia-Porterville, Riverside-San Bernardino-Ontario and Vallejo-Fairfield. That’s unchanged from the same time last year.
But foreclosures also rose by more than 25 percent in the Philadelphia, Chicago and New York areas. RealtyTrac warned that when those properties start hitting the market in the months ahead, they could weigh down home values.
At least for now, the opposite seems to be the problem in California, where there is a lack of inventory of homes for sale.
“Pending sales declined in June,” CAR President LeFrancis Arnold said, “partly due to a lack of housing supply – especially REO properties.” REO homes are usually bank-owned.
In San Joaquin County, fewer than 1,000 existing homes were on the market in June, less than half the number for sale in September.
The inventory of homes for sale has dropped for nine straight months, although median prices have been locked in a narrow range of between $155,000 and $168,000 for the past 12 months.
The lack of inventory has forced buyers to make multiple offers as competition heightens for what homes are on the market.
“It’s very interesting to watch from my level,” said Sheri Pritchett of Innovative Realty in Stockton, “and frustrating.”
Contact Eric Grunder at (209) 546-8261 or at email@example.com.
©2012 The Record (Stockton, Calif.)
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