Listings of foreclosed homes grew in October in Glendale, a city in Los Angeles County and located in the San Fernando Valley, according to a foreclosure report from a California-based real estate research company.

One out of every 290 homes in Glendale was in default or in foreclosure in October, an increase of 32 percent compared to the previous month, when the rate was one out of every 384 homes. A total of 238 homes went into default or foreclosure in Glendale, showing the adverse effects of high unemployment rates and loans that had terms unfavorable to borrowers.

Keith Sorem, a realtor based in Glendale and working with Keller Williams, said that he expects more foreclosures in the city if the unemployment problem is not addressed.

In contrast, nearby cities such as Burbank and census-designated places such as La Crescenta and La Canada Flintridge experienced drops in foreclosure activity.

La Crescenta had the most substantial drop, falling from a foreclosure rate of one out of every 81 housing units in September to one out every 160 units in October. Realtors, residents and housing advocates were astounded by the sharp foreclosure drop in La Crescenta because the area once had a foreclosure rate of one out of every 48 units in one particular quarter.

According to housing analysts, listings of foreclosed homes declined in some California areas because of the increased focus of federal and state officials on the implementation of the Home Affordable Modification program. The moratorium program of the state also delayed foreclosure actions on many distressed borrowers.

Paul Habibi, a real estate professor at the University of California in Anderson, said the renewal of the first-time buyer tax credit and its expansion to include move-up buyers have helped rejuvenate the housing market. He added that the loan modification program appeared to have slowed the pace of foreclosure activity a bit.

In Burbank, one out of every 298 homes was in foreclosure in October, a drop of 27 percent from September but still an increase of more than 200 percent from foreclosure filings in October last year.

In the La Canada area, one out of every 381 houses was in foreclosure, a drop of 21 percent from September.
Despite the drops in foreclosure activity, housing analysts expect more residential properties to enter listings of foreclosed homes in the coming months after various factors temporarily holding back foreclosures are reversed.

San Diego foreclosure listings have been including a rising number of hotels, based on data from Atlas Hospitality Group, a seller of hotels in California.

In just 8 months, defaulting San Diego hotels has quadrupled in number as the number of owners failing to pay their loans soared in number.

In January, there were only two hotel foreclosures in the San Diego area. In September, there were 4 hotels which went into foreclosure. They were Pacific Coast Inn, Mount Woodson Hotel in Ramona, El Camino Motel and Harbor House in Little Italy.

Over the past months, the hotels that have gone into foreclosure were all the San Diego branches of Extended Stay America, several Home Studio hotels and some units of Mission Plaza Suites.

Across California, a total of 260 hotels have been pushed into default as of September and 47 have been foreclosed.

One of the more prominent San Diego hotels which recently defaulted was the W Hotel, operated by Sunstone Hotel Investors. Sunstone walked out of its loan balance of $65 million. Sunstone has been losing huge amounts of money on the property and could not generate enough sales to pay the loan. Sunstone purchased W Hotel in 2006 for $96 million.

According to Alan Reay, executive of Atlas Hospitality, higher-end resorts and hotels are suffering more than the regular hotels because consumers have been looking for hotel bargains. He expects more hotels to enter San Diego foreclosure listings in the coming months.

One major factor that has stepped up the pace of hotel foreclosures is the increased number of hotel rooms available in San Diego. According to Atlas, 3,400 hotel rooms were added to the hotel room total in the area since 2007. This includes the 1,190 hotel rooms added when San Diego Hilton opened last December to support the city’s convention center.

Hotel owners and operators are saying that the decline in hotel customers and the purchase of cheaper hotels have been pushing downward hotel prices, cutting hotel revenues and forcing more distressed hotels into foreclosure.

According to San Diego hotelier Robert Rauch, investors buying cheap hotels can sharply reduce prices, killing the businesses of owners who bought their properties at full price.

Sunstone is one investor looking for bargain-priced San Diego hotels. It already launched a 20-million-stock public offering to raise funds for the purchase of hotels.

Las Vegas foreclosure lists put the city on top of the foreclosure rate chart in the July to September quarter, based on a report released this week by a foreclosure tracking firm.

With one out of every 20 residential units in foreclosure or 5.13 percent of all units, the Las Vegas and Paradise metro area ranked first in a survey of 203 metro areas in the U.S. Over 40,000 housing units in the area were hit with foreclosure filings.

The pace of foreclosure climbed up by almost 54 percent from the same period last year and rose by 5.4 percent from the April to June quarter.

The other Nevada metro area in the top ten was the Reno-Sparks area, where one out of every 37 residential units was hit with foreclosure. More than 4,700 units received foreclosure actions, representing 2.67 percent of all units in the area. Third quarter foreclosures marked a staggering increase of over 80 percent from the same quarter in 2008 and an increase of 14.2 percent from the April to June quarter.

Because of the increase in number of homes in Las Vegas foreclosure lists, home prices in the city fell in September by 37 percent, based on data from a San Diego real estate research firm. The median sales price in the area for all homes and condo units in September decreased to $130,000.

More than 5,000 homes and condos were sold, marking an increase of 17 percent from September 2008 and an increase of over 6 percent from August this year. Purchases made by representatives of absentee buyers comprised around 40 percent of all homes sold in September.

In Clark County, where Las Vegas is located, a total of 3,162 homes and condo units were foreclosed in September. Two-thirds of all pre-owned houses sold in the county were foreclosures that had been repossessed over the past 12 months.

According to the reports, the continued increase in foreclosures in Las Vegas and other metro areas were largely due to the continued rise in unemployment and the resetting of pay-option adjustable mortgage loans. These factors also caused the increase in foreclosures in areas previously immune to significant increases in foreclosures, such as the Boise-Nampa area in Idaho and the Provo-Orem and Salt Lake City areas in Utah.

Jacksonville foreclosure lists continued to push first time homebuyers to make their home purchases in September, based on data from the Florida Association of Realtors and the National Association of Realtors.

According to NAR, first time homebuyers nationwide who completed their home purchases in September to beat the federal tax credit expiration comprised 9.4 percent of all September home sales.

First time homebuyers can time their purchases well because they do not have a home to sell first before buying, unlike homeowners who want to move up or to relocate. According to realtor associations, the trade-up home market in many areas of the country is not active.

In Jacksonville, home sales brokered by members of FAR increased to 1,127 units in September, up by 10 percent from the August sales of 1,024 units. What was significant about the sales however was the sharp drop in the median sales price for single-family houses, which fell sharply from the December price of $150,000 to $139,900 in September. This median was the lowest price level experienced by Jacksonville over the past 5 years.

According to FAR members, the sharp drop in home prices was largely caused by the still large number of residential units in Jacksonville foreclosure lists and the high unemployment rate. The jobless rate in Jacksonville rose to 9.92 in September from 9.86 in August.

Meanwhile, pending home sales in Jacksonville also increased in September, based on data from the Northeast Florida Association of Realtors. A total of 1,628 pending home sales contracts were posted while a total of 1,297 sales agreements were closed. Out of these closed sales, 336 were mediated by lenders.

The median sales price remained low, dropping by 15.4 percent to $145,000 compared to September last year.

In addition to the first time homebuyer tax credit, low mortgage rates also enticed buyers to buy, according to realtors. They added that short sales and foreclosure sales continued to slow the housing market, but the increases in pending sales and closed home sales are positive signs.

Local broker Sam Folds said home prices are still low because foreclosure sales and short sales are still driving the market. But he is hoping that the entry of high-end foreclosures into the market will push up prices. He added that bigger foreclosed homes are entering the market because of unemployment.

San Jose foreclosure listings continued to grow in the third quarter as more foreclosures occurred in higher-cost neighborhoods, based on data from a foreclosure tracking firm.

In the July to September quarter, a total of 8,185 residential units in the San Jose-Santa Clara-Sunnyvale metro area have been hit with default and foreclosure notices, representing 1.29 percent of all households in the area.

With a foreclosure rate of one in 77, the San Jose metro area ranked 35th in a ranking of 203 of the largest metro areas in the country based on rates of foreclosure. The rate marked a 2.68-percent increase from the previous quarter and a nearly 29-percent rise from the July to September quarter in 2008.

According to foreclosure analysts, the increases in foreclosure filings in the third quarter were no longer largely caused by the delinquencies of subprime borrowers, but by unemployment and the rate resetting of pay option adjustable mortgage loans. According to Credit Suisse, the next flood of foreclosures will arise from the resetting of Alt-A and option ARM loans over the next several months.

While the unemployment rate in the San Jose metro area dropped to 11.8 percent in September from 12.1 percent in August, the jobless level is still high, much higher than the nationwide rate of 9.8 percent. Job losses in the manufacturing, hospitality and leisure sectors pushed more homes into San Jose foreclosure listings.

In nearby San Benito, the jobless rate was 12.5 percent, and in Santa Clara, the jobless rate was 11.8 percent. These two counties lost a total of 2,600 jobs between August and September this year.

Unemployment has also adversely affected housing in high-end communities. Based on data from Credit Suisse, many middle-class Americans took out Alt-A and option ARM loans during the boom years of 2004 to 2007. Because more and more residents of higher-cost neighborhoods have also been losing their high-paying jobs, a rising number of higher-end homes have been entering foreclosure.

As seen in the foreclosure chart of metro areas recently released by a foreclosure research firm, the pace of foreclosure has been rising in cities which were previously at the bottom of the chart.

In San Jose, homes which were purchased for $850,000 are now being sold at only $420,000, more than 50 percent below their original prices. California analysts predict that the trend will continue into the next year.

Affordable homes in San Francisco foreclosure listings are being offered to lower-income families through the combined home loan programs of the Federal Home Loan Bank of San Francisco and the Federal Housing Administration.

According to Marietta Nunez, community lending vice president for FHLBank San Francisco, the Individual Development and Empowerment Account and Workforce Initiative Subsidy for Homeownership programs of the bank can be combined with the Streamlined 203(k) rehab program of FHA to help lower-income families move from renting to home ownership.

The IDEA and WISH grant programs of the bank provide grants to qualified low-income or moderate-income families to help them pay their closing costs and make their down payments. The bank provides up to $15,000 in grants, granting $3 to match every dollar saved by the qualified buyer for the acquisition of a home.

Among qualified families are those that have FHLBank individual development accounts, which are designed for home ownership, and those who are members of the Family Self-Sufficiency homeownership initiative of the local housing authority in San Francisco.

Meanwhile, the FHA Streamlined initiative provides up to $35,000 for the repair of a home purchased from San Francisco foreclosure listings and listings of older residential properties. The Streamlined program is a simplified version of the standard 203(k) program because it combines financing for the purchase and repair of homes into only one mortgage loan.

Nunez said that the combination of the bank’s closing and down payment assistance initiatives with the FHA home purchase and rehabilitation initiatives is a potent combination to prevent the destabilizing impacts of foreclosure properties on neighborhoods. She added that the combined programs have been helping nonprofits and housing agencies acquire bank-owned foreclosures and older properties and turn them into affordable housing units.

According to San Francisco FHL Bank, it has already provided $10 million in IDEA and WISH grants to nonprofits and housing agencies to help qualified families buy their first homes.

Meanwhile, based on data from a real estate research company, nearly 33 percent of all previously owned houses sold in September were foreclosures that have been repossessed by lenders within 12 months prior to the sale.

Additionally, more than 25 percent of all home loan purchases in San Francisco in September were financed through FHA loans, an increase from the 24.9 percent level in August.

Indianapolis foreclosure lists have been pushing up home affordability in the area, based on a report from the National Association of Homebuilders and on the Housing Opportunity Index of Wells Fargo.

With the Indianapolis median income of $68,100, the median home sales price of $107,000 gave the city of Indianapolis a home affordability score of 94.5 percent, making the city the most affordable city in the entire U.S. based on 2009 income and home price data.

Indianapolis has suffered from the difficulties of the auto industry, but previous and current efforts of the city to diversify into other industries such as insurance, banking, drug industries and government services, have helped the city survive job losses from downsized manufacturing plants.

Just like in other cities, the entry of relatively large numbers of foreclosure properties in Indianapolis has also pushed down the prices of homes and has improved home affordability levels. In the first two quarters of the year, over 11,000 residential properties received foreclosure postings, many of which were already repossessed by banks and added to their Indianapolis foreclosure lists.

Despite the improved level of home affordability in the city, sales of previously owned single-family houses fell in the Indianapolis metro area in September compared to sales in September last year, based on a report from the Indiana Association of Realtors.

Total home sales dropped by nearly 8 percent to 1,827 units, with sales falling by more than 8 percent in Marion County and sales decreasing by more than 7 percent in Hamilton. Marion had 893 houses sold and Hamilton had 366 homes sold.

The only counties with increased home sales were Johnson, with sales increasing by 16 percent, and Hancock, with sales going up by nearly 6 percent. The biggest decrease in sales occurred in Shelby County, with only 25 homes sold, marking a drop of 50 percent.

Across Indiana, home sales also decreased in September compared to last year, dropping by 7.7 percent. Karl Berron, CEO of the Indiana realtor association, said home sales have declined, but home values are still stable.

While home sales declined compared to last year, sales increased by nearly 2 percent compared to the previous month. The improved home affordability and the federal tax credit improved sales, according to F.C. Tucker which also tracks home sales in Indianapolis.

Stockton foreclosure listings are still dominating the housing market despite a slowdown in foreclosure actions, based on reports from real estate information providers and property analysts in San Joaquin Valley.

One real estate research firm reported that currently, foreclosure homes still comprise the majority of homes listed in Multiple Listing Services in the area. Of the more than 6,600 homes available for sale in listing services, around 6,200 units are foreclosure homes.

The average price in September was $132,978, an increase of 0.03 percent from the previous month. The average price slightly increased in the first weeks of October to $134,733. The increase in price was driven by the slower entry of new foreclosures. In the Stockton metro area, home buyers in August paid around $2,515 or 1.3 percent higher than the list price.

The slight home price increase in September was in contrast to the price decline in August. Based on the house price index developed by Integrated Asset Services, San Joaquin County, which covers the Stockton metro area, is among counties that suffered most in price declines in the country. San Joaquin, together with Lee County in Florida, experienced home price drops by almost 50 percent from their record peaks.

The still high number of homes in Stockton foreclosure listings has been worsening the economic situation of residents in the city and in whole San Joaquin Valley.

According to a study by Brookings Institution, although foreclosures were no longer as overwhelming as during the start of the housing crisis, high unemployment levels and low property prices are still pushing a large number of homes into foreclosure.

Although the unemployment rate in August in San Joaquin fell slightly because of the return of farm jobs and school district jobs, the rate was still very high at 15.7 percent, far above the nationwide rate of 9.6 percent during the same month and higher than the statewide rate of 12.1 percent.

In August 2008, the jobless rate in San Joaquin was 10.2 percent. Over the year, nearly 10,000 workers in the county had been laid off by employers.

In the Brookings study, Stockton and Modesto are still listed as among the country’s weakest metro areas while the other California metro areas of Fresno, San Jose and Sacramento have already moved up to the second-weakest category.

San Jose foreclosure listings in the commercial sector are growing, based on data from Bay Area commercial brokers and Santa Clara County property assessors.

The vacancy rate for commercial properties in the Bay Area has increased to around 20 percent as business enterprises cut down on their operations and costs. Shuttered businesses have also abandoned their rental spaces.

Steve Peck, a commercial broker in the area, said there are now a lot of distressed tenants who are sub-leasing their spaces and a lot of landlords who are offering free rent and other concessions just to reduce vacant spaces in their buildings.

They know that if majority of their spaces are vacant, their existing tenants could move out freely without penalties as described in their contracts. Low-occupancy buildings also tend to be avoided by new tenants.

One tenant who has negotiated for a low rental rate is Indu Jayakumar who heads an Internet marketing firm. She is now renting a 1,200-square-foot office for a per-square-foot rate of only $1.50. She added that her landlord granted most of her requests, including the repainting of the office.

Over the past 12 months, commercial rents in San Jose have fallen by 13 percent. Rents in San Francisco have plunged by almost 16 percent while rates in Oakland have dropped by 10 percent.

As commercial rents decrease and as tenants abandon commercial buildings, property owners and developers are left with no cash to pay their jumbo commercial loans, ultimately adding their properties to San Jose foreclosure listings.

Larry Stone, assessor of Santa Clara County, explained that commercial foreclosures usually happen if the property owners and developers are not able to refinance their maturing loans and their rents are continuously falling. Many developers also are unable to find investors who are willing to inject capital into commercial property projects that have low occupancy rates.

The only winners of the commercial property crisis are the new tenants and old tenants up for renewal who are able to demand concessions in rates and in other leasing services.

Another major difficulty affecting tenants in the San Jose area is the decline in lending from the U.S. Small Business Administration. Over the past 12 months, lenders participating in the SBA loan program have significantly cut down their lending programs because of concerns about business failures.

San Antonio foreclosure listings have been showing stable prices, according to data released by the San Antonio Board of Realtors.

Among the reasons for the price stability are the level supply of homes for sale in the city and the slowing entry of foreclosures into the market, according to city realtors. Travis Kessler, chief executive of SABOR, said the city has an eight-month supply of houses for sale, which is a stable level.

Based on SABOR data, there were 1,561 houses sold in September, a drop of 2 percent from sales in September 2008. Florence Terrell, chairperson of SABOR, said the sales decline slowed, compared to sales drops in the early months of 2009 when sales fell by two-digit percentages.

Terrell also said that the July and August home sales surpassed sales during the same months last year.

Home prices stayed around $151,000, almost the same as the median home price in September 2008. Kessler explained that the level of supply made home prices stable. Year-to-date home sales dropped by 10 percent to 13,546 units.

Kessler also said that the federal $8,000 tax credit prompted a lot of first time home buyers to make their home purchases in September. He said that houses prices below $200,000 comprised 74 percent of total home sales in September and that around 10 percent of home sales were short sales and sales from San Antonio foreclosure listings.

He said that the $200,000 price range has been the price level preferred by first time home buyers. Over 70 percent of house sales so far in October were priced around $200,000.

Another San Antonio realtor and owner of a real estate firm, D’Ann Harper, said that first time home buyers have helped her business tremendously.

Real estate business owner Rick Kuper also reported that pending house sales in September rose from last year by about 11 percent to 1,494. Because of the increase, he said he is expecting an increase in sales in October and in the remaining months of 2009.

While the realtors in San Antonio are reporting a stability in home prices in their city, one online real estate research firm reported that San Antonio is among the cities with the biggest percentage of price drops for the June to October 2009 period. The firm reported that home prices in San Antonio dropped by 37 percent in October.