Not good news for CA Real Estate:
The looming problem for the housing market in San Joaquin County is not the banks selling off foreclosed properties but the growing number of homeowners who are not keeping up with mortgage payments, says an analysis of the market by University of the Pacific.
“The future of the San Joaquin County housing market depends on the resolution of the rapidly growing number of delinquent borrowers. There are now many more seriously delinquent mortgages than loans in the formal foreclosure process,” says the report by Jeffrey Michael, director of the university’s Business Forecasting Center.
“It is a safe bet that short sales will continue to rise and could become more common than REO sales over the next two years,” says Mr. Michael’s report, “Delinquencies, Defaults, and Foreclosures: Understanding the San Joaquin County Housing Market.”
He says it is unclear how well mortgage modification efforts are actually working in the market, which was one of the original epicenter’s the nation’s housing collapse. In September 2008, the House of Representatives’ Committee on Financial Services held its first field hearing on the mortgage meltdown in Stockton.
“If mortgage modification efforts prove unsuccessful, 2011 could be the year when the long-awaited “shadow inventory” finally hits the market,” says Mr. Michael.
His report says it may take as long as ten years for natural population growth to cause even a modest increase in home prices.
