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News Local News Fewer foreclosures in 2011
Fewer foreclosures in 2011
 A foreclosure sign hangs in front of a Jamestown house. Foreclosures are down in Tuolumne County. Amy Alonzo Rozak/Union Democrat, copyright 2012
Tuolumne County foreclosures declined nearly 12 percent in 2011 compared to 2010, according to data provided by the Tuolumne County Recorder’s Office. Last year 381 homes were foreclosed, down from a 10-year high set in 2010 when 431 homes went into foreclosure. Though the number of distressed properties dropped significantly, they remain much higher than in 2005 when only nine homes were foreclosed.
Calaveras County foreclosures held steady last year. In 2011 there were 554 foreclosed homes compared to 553 foreclosed homes in 2010. The past two years represent a slight improvement over 2009, when the number of foreclosed homes reached a 10-year high of 595.
But since the beginning of 2012, 31 additional homes have been foreclosed.
“For us, we’re such a small county. A handful is a lot,” Darla Rosenquist, a broker at Coldwell Banker Action Realty, said.
A year-end report from the foreclosure tracking firm RealtyTrac indicated that national foreclosure activity in 2011 was at its lowest level since 2007. California had the third-highest foreclosure rate in the U.S during 2011, with one in 31 housing units entering foreclosure. It was behind Arizona, where one in every 24 units entered foreclosure, and Nevada, where the rate was one in 16.
“Modesto, Merced, and Stockton have been leaders in number of foreclosures in the country,” Tuolumne County Assessor Ken Caetano said. “We’re bound to experience some fallout from that.”
Foreclosure in California takes place in three steps. The homeowners who have stopped paying their bills first receive a notice of default on their mortgage. If they are unable to make arrangements with their lender, the lender will send a notice of trustee sale, meaning that the home will go up for auction in court. Finally, trustee deeds of sale indicate that the home has been auctioned.
According to the data from the Tuolumne County Recorder’s Office, 64 percent of Tuolumne County homes that received notices of default in 2011 finished foreclosure by the end of the year. In 2010, 62 percent of defaulted homes finished foreclosure. That compares with a pre-recession figure of just 25 percent for 2007. In Calaveras County, nearly 83 percent of homes that defaulted in 2011 finished foreclosure by year’s end. Only 34 percent of defaulted Calaveras County homes finished foreclosure in 2007.
Rosenquist said more Calaveras County homes were foreclosed in neighborhoods where homeowners commuted to work in Stockton or the Bay Area. Valley Springs, closest to the stressed housing market in the San Joaquin Valley, was particularly hard-hit. Copperopolis, which saw the construction of new subdivisions during the housing boom, has been another trouble spot for foreclosures.
“Neighborhood by neighborhood around here, most of the foreclosures are low-end, but creeping into the high end,” said Emmett Brennan, owner and broker at Real Living Sugar Pine Realty, which operates six offices in the central Sierra region of California.
Tuolumne County foreclosures also weren’t limited to any neighborhood or town, according to Tuolumne County Assistant Assessor Kenneth Townsend. “There are foreclosures everywhere in the county,” he said. “I would say that the most depressed area is Don Pedro Lake and Pine Mountain Lake.”
In 2008, the total number of finalized foreclosures in Tuolumne County jumped almost 170 percent from 83 to 223.
As foreclosure activity spiked, the median value for homes in the county plummeted.
“Every time there’s a foreclosure sale, it brings the rest of the market down,” Brennan said.
Appraisers may value a foreclosed home at 95 percent of its market price, but banks or equity firms frequently rush to resell the house and accept lowball offers.
“The other thing is, they will not do repairs,” Brennan said. “Lighting fixtures, doors — anything the seller can take with them, they will. So you have half a house. There’s diminished value.”
Appraisers compare houses to units in the immediate area before assigning value. According to Brennan, appraisers try not to use foreclosed homes for comparison. “But if that’s all they can use, that’s all they can use,” he said.
According to property data from the Tuolumne County assessor’s office, median property values dropped by more than 57 percent between 2006 and 2010.
“We went from a peak of $332,000 in 2006 down to $190,000 in 2010,” Caetano said.
The Tuolumne County Assessor’s office is still processing the property value data for 2011. Caetano said preliminary data showed a continued drop.
“We didn’t see [median property value] go up as fast as it did between 2000 to 2006, and we’ve never seen it go down as fast either,” Caetano said.
The Calaveras County Assessor doesn’t track median values across the county, according to Randy Gomes, the county’s chief appraiser. But the online realty database Zillow shows a steep drop in the median home sales value for Calaveras County since 2008. The median sales value for last year was $204,300, representing a 47 percent decrease from about $385,000 in 2008.
“It’s been on a steady decline since 2005,” said Gomes.
For Tuolumne and Calaveras county homeowners and prospective buyers, the future remains uncertain. In its year-end report, RealtyTrac predicted that the national rate of foreclosure will rise again in 2012. But some signs show that the drop in local property value may be slowing.
“I like to think we’ve hit bottom,” said Brennan of Real Living Sugar Pines Realty. “Since the volume of unit sales is increasing, that’s a good sign.”
The increased sales volume has largely come from lower-end units, driving new buyers into a higher tier, he said.
“It’s coming back. It does every economic cycle. You’re going to make three times back what the value was at the beginning of the cycle at the next peak. It’s been that way ever since I’ve been in business for 36 years,” Brennan said.
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