$2 Billion Per Month, and Rising...

Well, here comes the flood. I hate to say "I told you so". So, I won't. Man that is so smug!

Anyway, from the Central Valley Business Times: California foreclosure sales near $2 Billion in March

FCs in CA reach $2 Billion, with a "B", in a single month.

There are a few keys to this article that I would like to point out. I know you were waiting for that - my articulate and in-depth analysis.

Key #1

Of the $2 billion worth of properties sold in March, 4,796 went back to the
lender after receiving no bids, representing $1.82 billion...

Did you catch that? 91% of all of the homes that were foreclosed on were not sold at auction time on the courthouse steps. Casey Serin knows all about that.

What that means is that the lender took the assets back as REOs and now not only needs to service its pool of existing paying "customers" (which in the industry, we call “performing”), but now they also need to manage and market its ever-growing list of unsold and stagnant properties. Time is money - and someone is going to pay for that. Likely by foregoing coming into their brick-and-mortar office space and sacrificing themselves on the altar of unemployment.

Key #2

Four of the state’s top five counties for foreclosure sales last month, on a per
capita basis, are in the Valley.

As in, “the valley” that we in Amador look down on from our lush, green, lofty heights. That should really prop up values in the high-country with dropping appreciation (some call depreciation) just a few miles down the hill.

Key #3

Foreclosures sold at auction now account for 15 percent of all home sales in
California and continue to rise...

This is the kicker! Do the numbers - you don't have to be a NASA engineer to figure this one out. If the 8% of FCs that actually sold at auction represent 15% of all of the sales in CA for the month, then you can see that it only takes a few months to reveal that there is a bulging glut of unsold properties out there.

Somehow, I don't imagine that it will be the buyer that gives in first. Tick-tock, tick-tock - so goes the clock. Who will cave from the pressure of time?