Mortgage Default Notices Hit Four Year Low
The number of default notices mailed out by banks in April, May and June totaled almost 57,000, down significantly from the 70,000 issued during the same period last year. Default notices are the first official sign that a homeowner is on the path to a foreclosure. A San Diego based Real Estate tracking firm cast a cautious eye on the numbers.
"The economy is still fragile, and the housing market is still fragile," said Andrew LaPage of Dataquick. "There are plenty of reasons to be concerned that lots more foreclosures could be coming into the system."
Even so, mortgage default notices are at their lowest level in four years in California and observers say that's a signal the housing market is stabilizing.
"We don't see rampant, sharp home-price depreciation anymore, because its when prices are falling sharply that you tend to see the most foreclosure activity," said LaPage. "We're still at levels that are high, historically speaking."
Foreclosure related sales made up nearly 36 percent of all transactions in the second quarter. That's down from a peak of nearly 60 percent. When the market is in balance that rate is typically in single digits, according to LaPage.