Thursday, January 20, 2011

Default Notices Drop In Santa Clara County

As most buyers know, there are very few default notices in Los Altos or Los Altos Hills.  Now we hear word that default notices are dropping again in Santa Clara County as a whole.  An article in the San Jose Mercury News reports that default notices (often mistakenly called foreclosure notices) dropped year-over-year in 2010, down over 33% to 10,052.  That's still higher than 2007 but it shows a trend driven by a stronger economy.

There are 11 properties in Los Altos with notices of default filed at this time.  Most of these will either have the default corrected (by bringing the loan current) or they'll be sold on the open market.  There are only 4 properties in Los Altos that have become "bank owned" or REO properties.  One of those has been on the market for a long time because it's in an undesirable location and the property condition has deteriorated considerably.  Poor locations are a common theme with foreclosed properties in Los Altos and Los Altos Hills.

Los Altos Hills has 3 properties with notices of default at this time.  The homes are a mix of moderagely sized homes (for the hills) and generally they will also be sold on the open market.  Recent REO homes in Los Altos Hills have been priced very low and some have gotten 50+ offers (many all cash) pushing the prices up to or close to market rates.

The market will see a few more of these in the coming year but the trend has been to sell these homes before they hit the market.  If you're looking for a bargain on foreclosed properties, there are two things to consider; location of the property and general market strength.  The properties that don't sell in the open market are usually in very poor locations which is why they stay REO for so long.  The rest sell at market rates because the market in Los Altos and Los Altos Hills have recovered substantially from years past.

No comments: