California Witnessed an Increase of 300% in foreclosure homes

August 15th, 2007 | Tags: Foreclosure Homes

In the entire US, the foreclosure activity is taking place at a fast place. But, in California, it is shocking to see a dramatic increase of 300% in foreclosure homes in the month of June. The total price at which the homes put on auction were sold was $2.82 billion.

According to the recent reports submitted by RealtyTrac, which is basically an online market where the foreclosed properties are sold and purchased, June has seen the worst situation. In comparison to the last year, the rate of foreclosure went up by 286.81%. On the basis of the statistics, the general trend observed is that the average rate of increase in the foreclosed homes is near about 86.68%.

RealtyTrac reports are suggestive of the fact that, one out of every 315 households is facing foreclosure in the state of California, which is 2.2 times higher than the average of the entire nation. The foreclosure activity was especially high in the following cities: Merced, Stockton, San Bernardino and Modesto. However, other cities were no less.

California is constantly appearing on the top in the foreclosure listings. This is the sixth month, when it has again had the maximum number of foreclosed properties. Population is partially responsible for the increasing foreclosure listings in California. However, there are other factors too that have made an immense contribution such as the declining home prices, changing rate of interest and the inability of the homeowners to pay back their subprime mortgage loans.

According to the estimations, near about $1 billion is not likely to be recovered. This is an indication that the activity of foreclosure will continue to increase in the state of California. Well, that does not mean that the situation is going to remain the same throughout the year. The situation will definitely improve in the future but the exact time frame is not yet known.

In the month of June, the foreclosed homes being auctioned fetched a total amount of $2.82 billion. Riverside county got the best deal with 1,093 homes being sold at a price worth $523 million. Yuba, Sacramento, and San Joaquin occupied the 2^nd, 3rd and 4^th positions respectively in terms of getting the highest amount by the sale of foreclosed properties. Due to a rise in the foreclosure activities, about 16% homes sold in California are the foreclosure properties.