The economic crisis in California is being caused, to some degree, by the high number of home foreclosures in the state. The record number of foreclosures has far reaching implications for individuals, families, and the investment and banking industries within the state. Our state should promote home ownership and help hard working California families stay in their homes. Doing so will ensure that the foundation of California’s economic future is maintained.
This web-portal is dedicated to educating and providing resources on this issue. I invite you to read for yourself and explore the articles, non-partisan studies, and governmental data contained in the links below.
California ranked number one in the nation with the highest number of foreclosures in 2008. More than half a million homes went into foreclosure and were turned over to banks.
The city of Stockton ranked number one in the nation for the highest percentage of homes foreclosed upon.
California, Florida, Arizona post highest 2008 foreclosure totals . A total of 523,624 California properties received a foreclosure filing in 2008, the nation’s highest state total. Foreclosure activity in the state increased nearly 110 percent from 2007 and nearly 498 percent from 2006.
Home values sharply declined. California’s median home price dropped 38% in 2008. The median home price in the nine-county San Francisco Bay area fell 44 percent, from $587,500 in December 2007 to $330,000 December 2008. That's the lowest since March 2000, when it was $320,500, and marks a 50-percent decline since the peak of $665,000 in the summer of 2007. Nationally, home prices rose 0.8%, well ahead of California but the slowest national growth since 1990.
The high rate of foreclosures was expected to peak in 2008, but a total of 500,000 more homes are expected to go into foreclosure before the end of 2012, which means this problem is going to be with us for a number of years. Until job losses taper off and home prices stabilize, the real estate market will continue to be unpredictable at best.
California is in a recession. Senator Barbara Boxer released a report in December 2008 entitled “The Realities of Recession in California” which detailed the unemployment and foreclosure rates county by county. Unemployment rates are remarkably high, all across the state, and the rate at which homes are going into foreclosure has increased nearly 110 percent since 2007 and up nearly 498 percent since 2006.
Related industries, such as construction, are suffering. The California Farm Bureau Federation reported in January that the “collapse of the state’s real estate sector is pulling down a long list of related business sectors” including timber, nursery and landscape products.
Vacant foreclosed homes are a public safety and health concern. Local governments are finding that vacant homes are a public safety hazard, for a myriad of reasons, including squatters illegally occupying the homes, the increased risk of arson and vandalism, and even backyard swimming pools becoming fetid, mosquito-breeding swamps. Neighbors are complaining about homes on their blocks sitting empty and bringing down their property values and posing a safety concern for children.
There have been many legislative efforts to help people during the foreclosure crisis. One measure passed and signed by the Governor required lenders to explore restructuring options with homeowners before initiating the foreclosure process. Other measures were designed to expand affordable home options, and protect homeowners and buyers.
Republicans were responsible for seeing that a $10,000 new home buyer tax credit was included in the February budget. The housing industry in California has been hit very hard by the economy. It makes sense to do everything possible to stimulate the housing market and help people stay in their homes.
The Governor also launched the Community Stabilization Home Loan Program in July to help communities hard hit by foreclosures. The program is designed to help first-time homebuyers purchase homes in communities hardest hit by the foreclosure crisis.
The Fair Housing Council of Orange County
201 South Broadway
Santa Ana, California 92701-5633
Phone: 714-569-0823 or 800-698-FAIR
Fax: 714-835-0281
info@fairhousingoc.org
Neighborhood Housing Services of Orange County
198 West Lincoln Avenue, 2nd Floor
Anaheim, California 92805
Phone: 714-490-1250
Fax: 714-490-1263
Contact@nhsoc.org
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