Foreclosures Skyrocket In May

Posted on June 30, 2008
Filed Under Foreclosure Homes |

Foreclosures in San Fernando Valley skyrocketed by 242% during the month of May. This is against a background of poor sales. A cocktail of woes has combined to bring down the real estate market to record low levels since the last four year. All the various reports coming in more or less contribute to this picture with minor variations.

But although the weather is dark and cloudy some experts are of the opinion that the skies are about to clear. In April the sale of houses inched up to 1,047 from the April figure of 960. However in May 2007 there were 1,434 sale transactions. This May holds the lowest sales figure since 1988.

The number of foreclosures jumped to 673 in May from 202 in the previous year according to the findings of San Fernando Valley Economic Research Center of California University. The real estate market is choc-a-bloc with foreclosed units with more pouring in. This has led to a drop in the average price by 27%. It fell from $660,000 in May 2007 to $485,000 in May 2008. In April the average price was $505,000. The Director said that the Northeast Valley was particularly affected with a sharp fall of 35% that calculated to $345,000 being the average sale price. The Central Valley dropped by 30% with the average plummeting to $390,000. The Northwest Valley recorded a drop of 29% with the average being $465,700. The best regions were Burbank and Glendale with a decline of 20% calculated year-to-year. The average here was relatively better – it being $619,500. It is obvious that not all the mortgages are buckling under but are being carried on.

Default notices in May counted to 1,488 – it being 5% less than April but more than double the number of defaults of May 2007.

Another report coming from The Southland Regional Association of Realtors (Van Nuys based group) showed the trend to be similar but the sales figures were at variance with the previous report. According to it the average price dropped by 31% to $450,000 – it being $200,000 less than what the level was in 2007. The May figures fell by 3% from April. The sale of properties in May increased by 6% numbering 669 deals in comparison to what it was in May 2007. Compared to April it jumped by 22%.

The May report showed the dropping of condo sales by 33% with only 168 deals. The average price fell to $299,000 – a drop of 23%.