California Foreclosure Uptick Doesn’t Indicate Long-term Trend

California Foreclosure Uptick Doesn’t Indicate Long-term Trend

03/15/2013 BY: KRISTA FRANKS BROCK

Foreclosures are declining in most of the Western states tracked by Foreclosure Radar, California, Nevada, Oregon, and Washington—but some experienced anomalous upticks over the month of February.

For example, in California notices of default and notices of trustee sale together increased 10 percent in February, according to the analytics firm. This is quite a change from the previous month’s 43.3 percent decline.

The firm anticipates a return to the recent trend of declining foreclosure activity in the state, which it suggests are driven by the National Mortgage Settlement and the passage of the California Homeowner Bill of Rights. Together these actions have led to increased foreclosure alternatives such as short sales.

While seen as positive for homeowners, ForeclosureRadar points out an unintended consequence of recent market conditions: decreased REO inventory, which is “still very much a part of the California real estate landscape,” the firm said.

“While policy makers state that the purpose of government intervention is to help homeowners by delaying foreclosures, instead they have created an artificial shortage in bank-owned (REO) inventory,” ForeclosureRadar stated.

California’s foreclosure timeline increased 6.14 percent in February.

Arizona also experienced an increased foreclosure timeline in February, rising 11.28 percent from the previous month.

However, notices of trustee sale in Arizona declined over the month in February, falling 36.51. Notices were down 65.51 percent year-over-year.

Similarly, notices of trustee sale in Nevada fell both monthly and yearly—by 14.19 percent and 41.68 percent, respectively.

Time to foreclose in Nevada decreased 4.69 percent in February.

Oregon’s notices of trustee sale increased 3.12 percent over the month of February but decreased 94.81 percent year-over-year.

Oregon’s foreclosure timeline decreased 3.03 percent over the month of February.

Washington experienced a decline in notices of trustee sale in February—a decrease of 23.53 percent. However, year-over-year, notices were up 89.12 percent, and the state’s foreclosure timeline increased 3.23 percent over the month of February.

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