Let’s check in on San Diego foreclosure activity.  This indicator is only marginally useful because, as discussed many times previously, much of San Diego’s foreclosed inventory has been kept off the market.  When new homes go into foreclosure, they may increase the backlog of “shadow inventory” but they don’t necessarily have any immediate effect on supply.  Still, it’s worth looking at how fast that backlog is building.

The red line on the accompanying graph denotes the number of monthly Default Notices, which occur when borrowers officially enter foreclosure.  The orange line signifies Trustee Deeds, which take place later in the process as homes are repossessed by their lenders.

Both rates have been trending down since last year, but both are quite high in absolute terms.  Even adjusted for population growth, the pace of both Default Notices and Trustee Deeds are higher than anything that was seen even at the worst of the early-1990s housing bust.

So while new foreclosures are gathering more slowly than they were in the darkest days of the recession, they are still piling up at a pace that — from a historical perspective — can be charitably described as “brisk.”


Leave a comment

We expect all commenters to be constructive and civil. We reserve the right to delete comments without explanation. You are welcome to flag comments to us. You are welcome to submit an opinion piece for our editors to review.

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.