Foreclosures Up, Sales Down

Housing is all over the Los Angeles Times today.

There's a story about the troubles at New Century Financial Corp., " the nation's largest independent provider of high-risk home loans" (see previous post). Watch for an increase in the number of people predicting a foreclosure crisis:

... Many homeowners with high-risk loans whose rates will adjust upward in the next year or two won't be able to refinance into loans with better terms. That could put some into foreclosure.

"If foreclosures continue to mount — and they are already climbing rapidly — we could see a scenario similar to California in the early 1990s, where banks' sales of foreclosed properties pushed home prices down even further," said Zach Gast, an analyst at the Center for Financial Research and Analysis, an investment research firm.

A comparison to the market woes of the 1990s? (Don't forget LA's lack of affordability).

Another story details how Los Angeles County's sales volume is sinking. There were fewer transactions in February than in any February since 1997:

In February, the median price of all homes sold in L.A. County rose 7.8% to $528,000, according to La Jolla-based research firm DataQuick Information Systems. It was the biggest year-over-year percentage gain since July.

At the same time, home sales fell 11% to 6,300, the fewest transactions for a February since 1997, DataQuick said. The rate of decline picked up from January, when sales fell 6.9% from a year ago, but was an improvement over mid-2006, when sales were falling at a 25% year over year pace.

L.A. County's median price -- the point at which half of all homes sold for more, half for less -- had been virtually flat since June, when the median was $520,000.

And finally, an upside: condos are still selling downtown.

— TJ Sullivan in LA