The number of San Diego homes officially going into default declined to 2,906 in August, down pretty sharply from July’s 3,543 defaults. The number of homes actually being repossessed by lenders also fell, dropping to 1,358 in August from 1,607 in July.

But while foreclosure activity may have declined from its recent levels, it was still quite brisk:

And the pace of foreclosures in August still towered over what was seen in the region’s 1990s housing bust:

The disposition of all these foreclosed homes is a hot topic. Will they eventually hit the market and put downward pressure on prices, or will they continue to remain in the shadows as they have thus far? Until that question is answered convincingly one way or the other, forecasting the future of San Diego’s housing market will be a tough business.

— RICH TOSCANO

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