Orange County Real Estate Report April 2010

April 30, 2010
Categories: Buyers, Sellers, OC Real Estate Reports
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Orange County Real Estate Report April 2010

OC Market Update: The State of the Market

For the past few years, California has experienced significant setbacks in housing — including its dubious position as the state with the second-highest foreclosure rate in the nation.

According to the California Association of REALTORS® recent study of 2009 and 2010 home sellers, 67% of California home owners put their homes on the market in 2009 as a result of difficulties related to meeting their mortgage obligation. That’s a substantial increase over 2008, when C.A.R. found 20% of homeowners, or one in five, sold due to financial difficulties.

Among the reasons for such sales cited in 2009 and 2010 were difficulty meeting mortgage obligations (30%), job loss (18%) and resetting adjustable loans (18%). Lower housing prices rendered some home owners unable to refinance; others saw home prices fall below what they owed on their mortgages.

Not surprisingly, only 7.5% of surveyed sellers reported they had a fixed-rate mortgage. 92.5% had an adjustable rate mortgage (ARM) with a two-year, three-year or five-year fixed rate, or a negative amortization ARM.

Nearly half of homes sold in 2009 were distressed homes in some stage of foreclosure or short sales. As a result of having such a high number of distressed homes on the market, homes that sold in 2009 averaged $20,958 less than the original asking price and $32,315 less than the median asking price.

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