A recent scan of the San Diego Daily Transcripts news headlines reveals that: San Diego’s housing industry one of top six, and San Diego foreclosure filings jump in March. So which is it? Is the housing industry strong, or are variable-rate loans and foreclosures bringing the market down. Let’s find out.
Below are some quotes pulled from the bullish story regarding the importance of the housing market:
With 11 percent of the entire state’s economic activity, California’s total housing industry is more significant than the wholesale and retail trade; professional, scientific and technical services; or finance and insurance.
The entire housing industry is 12 percent of San Diego County’s gross regional product.
This is why the statistics in the bearish second story are even more important.
California foreclosure filings jumped 36 percent to 31,434 in the month of March
The number of foreclosures is said to be the highest in 10 years, though there is some relief for homeowners facing rising mortgage payments, and variable-rate loans. Consumer Affairs reports that regulators urge mortgage lenders to be flexible with homeowners.
Institutions will not face regulatory penalties if they pursue reasonable workout arrangements with borrowers, according to a statement issued by the Office of the Comptroller of the Currency (OCC), oversees national banks. Joining OCC in the statement were the Federal Reserve Board, U.S. Department of Housing and Urban Development, National Credit Union Association, and Office of Thrift Supervision.
Seattle Times reports that Washington Mutual commited $2 billion to aid borrowers with subprime loans.
Seattle-based WaMu said it will allow subprime borrowers who are current on their loans but facing “payment shock” to apply for discounted 30-year fixed-rate loans.
That should help some homeowners, but resale home prices are lower and we are hearing of home buyers paying near full price but asking for thousands in cash back on closing. New home builders are also lowering prices and offering big incentives on their existing inventory.Then there are all the people who make a living in the housing industry. We have witnessed smaller mortgage companies and developers closing shop in San Diego.
Unfortunately for most San Diegans, except those looking to buy a home, we probably have not hit our low and have to wait a while before the market rebounds.
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In the past year, we have witnessed several mortgage shops in our building close down overnight. An industry once defined by conspicuous consumption, now finds themselves with time to pray to God for a market rebound. Just today, I heard through the grapevine about another real estate shop closing in the Eastlake area.
Some of them are expanding into Insurance, the next “market boom” for independent contractors.