California Posts 19.4% Increase in Foreclosures
The number of California homeowners going into foreclosure rose in October to the highest level since March, a real estate data firm said Friday, but analysts said the jump does not suggest a slowdown in the state’s budding real estate recovery.
Orange County, however, was one of the few areas where foreclosures declined, dropping 13.5% in October to 1,133 from 1,310 in October of last year.
Statewide, lenders started foreclosing on 14,598 homeowners last month, a 19.4% increase from 12,227 the month before and up 13.1% from 12,904 for October last year, according to DataQuick Information Systems in La Jolla. October had the highest number of foreclosures since March, when an all-time high of 15,473 was posted.
Still, with home sales statewide at the strongest levels in six years and home prices here beginning to firm, the foreclosure surge isn’t a signal that California’s real estate comeback is faltering, analysts said. Rather, it’s a sign that lenders are moving more aggressively to get rid of nonperforming loans.
“Our real estate recovery is still rock solid,” said John Karevoll, an analyst with DataQuick. “Clearly, a shift in policy by the lenders is driving this. They want to get these loans off the books by the end of the quarter.”
Another factor driving the foreclosure activity, Karevoll said, is the increasing use of foreclosure as just another financial tool, with the stigma surrounding it decreasing.
In Southern California, foreclosures were up a modest 6.7% in October, with 9,523 foreclosures posted last month compared to 8,929 during the same time a year ago.
In Los Angeles County, the number of foreclosures rose 11.6% in October from the same month last year. The surge of foreclosure activity was strongest in the Central Valley, where 2,523 foreclosures were recorded, up 49.6% from 1,686 foreclosures from October last year.
So far this year, 137,766 California homeowners have been drawn into the foreclosure process, up 24.1% from 111,015 for the same period last year, Acxiom/DataQuick reported.
DataQuick, a unit of Conway, Ark.-based Acxiom Corp., monitors real estate activity nationwide and provides information to consumers, lending institutions, title companies and industry analysts.