Foreclosure activity in San Luis Obispo County continues to fall, a sign that more property owners are able to hold on to their homes.
The number of properties with a foreclosure filing in the first quarter of this year was 177, down 38 percent from the same quarter a year ago, according to RealtyTrac, an online firm that publishes data on foreclosure activity nationwide.
In San Luis Obispo County, one in every 663 housing units had a foreclosure filing, which includes notices of default, scheduled auctions and bank repossessions.
“When looking at the foreclosure rate, one of the things that struck me off the bat is that among 58 counties in California, San Luis Obispo County is ranked 51st, and that’s at the bottom rate for foreclosures,” said Daren Blomquist, vice president at RealtyTrac.
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The county experienced its peak of foreclosure activity in the first quarter of 2011, when RealtyTrac reported 1,263 properties with foreclosure filings. The county’s level of foreclosure activity has declined due in part to a recent resurgence in the housing market, which has pushed up home prices and may have helped some homeowners retain equity and avoid losing their home.
The median sales price of all homes in the county was $450,000 in February, up 22 percent from the same month a year ago, according to DataQuick, which monitors real estate activity nationwide.
In California as a whole, however, the foreclosure situation isn’t as rosy. The state was one of 19 to see an increase in foreclosure starts — the first step in the foreclosure process — in the first quarter of this year, compared to the same quarter a year ago.
The increase is not surprising because of last year’s passage of the California Homeowner Bill of Rights, designed to prohibit lenders from engaging in unfair practices that needlessly force people into foreclosure.
Blomquist said the law artificially held back foreclosure activity, creating a backlog of distressed properties.
Now, banks have figured out how to adjust to the law and are starting to pay attention to properties that had been “sitting in foreclosure limbo for some time,” Blomquist said, and that has accounted for the increase.
Although there’s no evidence of a rebound in foreclosure activity locally, he said it could happen.
“The concern is not that there will be this secondary flood of foreclosures that will overwhelm the market, but there’s still some latent foreclosure activity that hasn’t been realized that could surprise people, and it could be a little bit of a cold shower for some,” he said.
Even so, it would be a “blip for the market” here, Blomquist said.
“It could be a little bit of a good thing for a market that may be becoming overheated,” he said. “In general, coastal markets tend to be more insulated, and even at the height of the housing market, foreclosure rates and home price declines were not as bad.”