That’s not a misprint.
The foreclosure rate for all Southern California was up 725% over the previous year quarter. It’s happening across the board, for pricey homes as well as small ones. Apparently well-off folks who could have gone with a 30 fixed mortgage went the variable rate route instead.
We are still on the leading edge of subprime resets. Many more foreclosures are coming. This aren’t abstract statistics but real people whose lives are being turned upside down.
The article notes that it’s “still well off that region’s previous peak of 11,494 [foreclosures] recorded in the third quarter of 1996, during southern California’s last real estate collapse.” Still, clearly not good news when you figure we’re still near the beginning of the ARM interest rate adjustment cycle.
I didn’t even know there WAS a collapse in ’96. But then, I was sleeping in a converted garage that year. There was also a collapse in 1990-1991, in which I lost my condo. That’s three collapses in 17 years. And they say real estate never loses?
This chart shows the number of subprimes about to reset.
http://polizeros.com/2007/07/23/any-questions/
Indeed, many more will be resetting in the coming months. We’re just on the leading edge now.