As the third quarter has come to an end, we can get a better look at a lot of our local real estate data. I’ll write some posts about our small cities in the next two weeks, but wanted to focus this post on Salem Oregon again, specifically looking at the foreclosure data.
The rise in foreclosures has been obvious to any local real estate agent. What used to be a rare blip in our market is a daily event. It is hard to do a home search these days and not see some sort of foreclosure or short sale pop up. So where are things at, as of the 3rd quarter?
Well, red is this year and blue is last year. There was an odd dip in the 3rd quarter last year due to the moratorium on foreclosures so the data is a bit skewed. I looked at the year to date data instead and there was a 121% increase in the notice of defaults served in 2009 year to date over 2008. The 3rd quarter spike we have is to do our fellow Oregonians struggling due to layoffs and pay cuts.
Today the unemployment rate announced at 11.5%. I’m not sure what Salem’s rate is, but hopefully, we saw a corresponding dip here. I still think we have a long way to go, and we will know more looking at the next two quarters after the home credit is gone. The numbers were an improvement this month, but it’s hard to know how much of that was unnecessarily inflated.
As for foreclosures…the numbers are still high and at this point increasing. I do think that if employment stabilizes then these rates will come down. For the most part, I expect these to be unemployment-related and not funky loan related.