According to the Central Valley Business Times, CoreLogic reports foreclosure rates in Stockton decreased in July compared to a year earlier. Foreclosures among outstanding mortgage loans were 4.38 percent down from last year’s 5.42 percent. However foreclosures are still higher than the national average of 3.13 percent and  the mortgage delinquency rate has increased. The 90 day delinquency rate is at 15.09 percent of mortgage loans, up from the 14.96 percent last year. This could mean that the numbers of successful loan modifications and short sales is keeping the foreclosure numbers down despite the increase of defaults. If you are considering a short sale or would like to learn more feel free to call Pat Holkesvig & Your Home Team at 209.471.6516 or complete our Contact Us form.  Pat Holkesvig and Your Home Team are The Central Valley’s Short Sale Specialists.  We process Stockton Short Sales, Elk Grove Short Sales, Lodi Short Sales, Lathrop Short Sales, Manteca Short Sales, Modesto Short Sales, Mountain House Short Sales and Tracy Short Sales.

According to Experian the Stockton area currently ranks 79^th out of 142 credit markets the company follows. This is optimistic news for the area which has been the real estate poster child for this recession with some of the highest foreclosure rates in the nation. Stockton with a current score of 744 is now just below the national average of 749.

Expert economists announced on September 20^th that the recession ended in June 2009. This is good news for the country, but not all areas are benefitting at the same rate of progress. Due to ongoing unemployment struggles faced by California and the valley, analysts are adjusting their previous economic predictions of relief in late 2010. However, the new projections have not been released yet. San Joaquin was one of the first areas affected by the recession and it will be one of the last areas to recover.  

Real estate market analysts have been hard at work crunching the latest round of numbers but what does it all mean? Wednesday the news looked optimistic for San Joaquin when it was reported that the area experienced a second quarter decline in foreclosures despite the fact that Stockton still remained 96^th in the nation for foreclosures. However on the heels of that report it was announced that US home seizures had reached a new record and are now 25% higher than a year ago and that California accounted for 1/5^th of the national total. UCLA economists predicted that California is on the road to recovery, but it will be slow stating that unemployment is not likely to fall below 10% until late 2012. This is something to look forward to for San Joaquin county which currently ranks 99^th in the nation for employment and housing prices.

Over the last month we have mentioned in Could This Be The End of Short Sales? and  No New Ideas From Mortgage Summit that it was rumored the Obama administration was about to order the government-controlled lenders to forgive a portion of the mortgage debt for Americans who are underwater. Today the Obama administration has indeed launched a revised government mortgage relief program referred to as the “short refinance” program .  However this program is not intended for Fannie Mae or Freddie Mac loans and it still faces the challenge of satisfying second lien holders. The administration still hopes that up to 1.5 million loans could be modified through the program. The intent is to focus on homeowners who are current on their mortgage payments but are at risk of default because they have no equity in their homes. It is still too early to tell how many Stockton area underwater homeowners will benefit from this program.  

Freddie Mac reports that the average rate for a 30-year fixed mortgage fell to another record low at 4.32%. The new 15 year fixed rate also dropped to 3.83%. These new record breaking rates show hope for a struggling housing market since the expiration of the popular home buyer tax credits. On 09-01-10 the Mortgage Bankers Association reported that mortgage applications for purchases increased last week and refinances were up 2.8%. It is too early to report on any impact these new mortgage rates will have on the local Stockton real estate market.

According to the Modesto Bee, in Stanislaus county underwater mortgages occur at twice the rate of the national average. The rate for San Joaquin county is even more extreme where 62.4% of mortgages are underwater compared to Stanislaus county’s 60%. The national average negative equity rate is 23% and the California state average is 33%. Areas high in negative equity have higher incidence of strategic defaults, short sales and foreclosures contributing to the slower market turn around.

The latest figures for existing homes sales were released this week with very discouraging results. Existing homes sales have hit the largest monthly decline in history at 27.2%. This is coupled with a record breaking 11 year peak in housing inventory. On the bright side, if you are looking to buy in the San Joaquin valley, there is no better time than the present. With great inventory to choose from and 30 year fixed  mortgage rates at an all time low of 4.56% it is truly a buyer’s market.

On August 12^th in the post Could This Be The End of Short Sales? we wrote about how On August 17^th  the Treasury was going to be holding a hearing regarding the future plans for Fannie Mae and Freddie Mac.  It was rumored that the Obama administration was about to order the government-controlled lenders to forgive a portion of the mortgage debt for Americans who are underwater.

Unfortunately, the flurry of buying activity Stockton real estate experienced this past spring has flittered away along with the federal homebuyer tax credits over the summer. Meanwhile the Stockton housing inventory has continued to grow as we head into the traditionally slow fall and winter months. As the number of potential buyers continue to diminish and housing inventory continues to increase, it is inevitable that prices will need to drop.