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After a steep increase at the beginning of the year, Marin foreclosures leveled off in the second quarter and fewer borrowers fell behind on their mortgages, according to figures released this week.
“This may be the point where we look back and say it’s starting to go in another direction,” Robert Bradley, president of San Rafael-based Bradley Real Estate, said of the mortgage crisis that began in 2006.
The county recorded 130 new foreclosures in the second quarter, identical to the number recorded in the second quarter of 2010, according to data from San Diego-based DataQuick.
Notices of default — the beginning of the foreclosure process when a homeowner falls behind on a mortgage — dropped 9.1 percent year-to-year in the second quarter.
One contributor to the easing of foreclosures could be an increase in the number of successful short sales, when a bank agrees to accept less than the amount owed on a house, Realtors said.
In the first half of 2011 there were 165 short sales closed in Marin, up 13.4 percent from 149 in the same period of 2010, according to data from Bay Area Real Estate Information Service Inc., a multiple listing service.
During the crisis short sales have been notoriously unpredictable, with deals sometimes delayed for months by banks overloaded with struggling borrowers. Now it appears the banks are quickening their pace, Bradley said.
“They are processing short sales so we never get
to the foreclosure point or maybe even never get to the notice of default point,” he said.
Troubled properties still make up a sizeable chunk of Marin’s housing market. In the second quarter, 183 of 861 total properties sold, or 21.3 percent, were either bank-owned or short sales, up from 17.3 percent in the same period of 2010, according to the multiple listing service.
Those properties can push prices down in neighborhoods, even if the seller does not have mortgage trouble.
“A condo that was selling for $250,000 six months ago in Central Marin might now sell for $200,000 because there is a glut on the market, and that glut is distressed sales, either bank-owned or short sales,” said George DeSalvo, a broker with Frank Howard Allen Realtors and a foreclosure specialist.
As bank-owned properties have become more widespread even borrowers who are not seeking foreclosures are likely to encounter them during their search.
On Wednesday, Stella and George Teigeiro of Mill Valley were house shopping in Novato’s Bel Marin Keys neighborhood when they drove past a bank-owned house on Montego Keys.
The previous owners bought the waterfront house for $1.1 million in 2004, and defaulted in April 2009 after taking out second and third mortgages worth a total of $767,000. Now the mortgage service firm Aurora Loan Services has listed the house for $680,000.
“I like the silence,” Stella Teigeiro said while standing on the house’s deck beside a quiet lagoon.
The four-bedroom house would be a spacious upgrade from the couple’s rented townhouse, Teigeiro said. That the property is a foreclosure is not especially important, she said, because she will use the same factors to judge every house: “If it’s a good price, what I need, what I want, what I can work with.”
Contact Will Jason via email at wjason@marinij.com
By THE NUMBERS
NOTICES OF DEFAULT
County 2010Q2 2011Q2 Yr/Yr%
San Francisco 431 402 -6.7%
Alameda 2,615 2,030 -22.4%
Contra Costa 3,139 2,552 -18.7%
Santa Clara 2,313 1,793 -22.5%
San Mateo 914 732 -19.9%
Marin 307 279 -9.1%
Solano 1,376 1,185 -13.9%
Sonoma 916 738 -19.4%
Napa 220 182 -17.3%
Bay Area 12,231 9,893 -19.1%
FORECLOSURES
County 2010Q2 2011Q2 Yr/Yr%
San Francisco 180 156 -13.3%
Alameda 1,418 1,317 -7.1%
Contra Costa 1,990 1,799 -9.6%
Santa Clara 1,081 991 -8.3%
San Mateo 369 328 -11.1%
Marin 130 130 0.0%
Solano 1,011 916 -9.4%
Sonoma 487 495 1.6%
Napa 131 129 -1.5%
Bay Area 6,797 6,261 -7.9%