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California Foreclosures/NOD filings {Sacramento}

2008 is going to bring a tsunami of REO business. For those thinking that we are, have or soon going to hit bottom, think again. I hope I am wrong, but looking at these figures I don't see how I could be. Once again, this reaffirms the fact that the best way to make money is to position yourself in this market with REO sales. I think real estate professionals that take advantage of the massive wave that's still to come will make more money then when market was hot few years ago.

Here are some numbers to crunch:

Last quarter of 2007 - 81,850 NOD's filed

First quarter of 2008 - 113,676 NOD's Filed

2008 NOD filings projection - 452,000 (estimate based on 113k/quarter)

The projection is based on the figure staying constant and not increasing as it has been every quarter. Also, between last quarter of '07 and first '08 there has been an increase of 39.4% in filings.

To sum it up, I don't think we've seen bottom and we will not see it until well into 2009 if not 2010. With inflation on the rise, weaker dollar, higher gas prices, higher unemployment, lower retail sales (not to mention major retailers shutting down nation wide), ridiculous increase in commodities, and the obvious lack of available financing (besides FHA), we are in for a long haul.

I pulled out a few quotes from an article I read this morning.

Stockton, Calif., had the highest foreclosure rate out of any U.S. metro area, with 1 out of every 30 homes receiving a notice - nearly seven times higher than the national average. The Riverside/San Bernardino region had the second highest rate in the quarter, with one of every 38 homes in default.

All of these foreclosure prevention efforts may not be able to stand up to the tsunami of foreclosures on the way. A record number of hybrid adjustable rate mortgages (ARMs) - worth $362 billion - will reset in 2008.

Posted by Paul Bozek on 04/29/2008 12:58 PM

Comments (3)

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3 Comments on California Foreclosures/NOD filings {Sacramento}

Thanks for sharing. This is a great time to get involved with REO companies and keep busy at the same time.

04/29/2008 01:05 PM

by Nathan Diones (RE/MAX Marquee Partners)

I hate to agree with you - but the writing appears to be on the wall!

In the last month we have lost 3 huge corporations - Aloha Airlines, ATA airlines, Molokai Ranch,The shut down will include the Molokai Lodge, the Kaupoa Beach Village, the Kaluakoi Golf Course, the Maunaloa gas station, the Maunaloa Tri-Plex Theater, cattle-rearing, and the company's substantial maintenance operations. and that was within 15 days of each other. A while back Hooters closed there doors here, we have been put on notice that Hard Rock Cafe will be closing its doors soon. 2 of the 3 cruise ships have also pulled out - we haven't even begun to see the worst of it. Most of what I have talked about here has just been in the last few months if not weeks, so how many more foreclosures are going to happen in the upcoming months. for the past 8 years - I haven't known a person unemployed in Kona - now I can name half a dozen people that are laid off. 4 of my current listings are Short Sales? And to top it all off - Saturdays headlines - Governor Lingle: Recent Closures not reflective of economy ??? WHAT KIND OF CRACK IS SHE SMOKING !!! She has every excuse in the world of why all these business have closed - but none of them have to do with the economy??? You know - if I keep writing about the Governor - it wont be very pretty - I think I will stop here.

To leave on a positive note: here on the big island our housing boom has only fallen 14% compared to Oahu's 74% drop - (probably because Governor Lingle lives there) but that is cause for another blog

Aloha, and have a great day

Lance Owens (RS)

(808) 936-8383

Lance@KonaHomeTeam.com

http://www.konahometeam.com/

Aloha Kona Realty Inc.

78-6740 Alii Drive

04/29/2008 01:32 PM

by Lance Owens (Aloha Kona Realty Inc.)

Lance, I agree with you, the writing is on the wall. Everyone in the market wants to put a positive spin on everything to boost consumer convidence. Why not right? I don't have a problem and even encourage keeping histeria at bay, but let's look at what's really going on and take action to fix the issues. Just because we don't want to acknowledge the problems doesn't mean that we have to sit on the sidelines pretending nothing is wrong. But hey, I'm sure the $600 bucks everyone is getting in the mail will fix everything ;)

04/29/2008 01:54 PM

by Paul Bozek (n/a)

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