Area foreclosures continue to rise
Himant Pandit bought his house two years ago, and has been and has been frustrated by the drop in his home's value. He said many of his neighbors have lost their homes to foreclosure. Pandit said he has seen six foreclosures on his street in the last three months. He lives in a KB Home subdivision where he purchased his 3,200 square foot home two years ago for $385,000.

Area foreclosures continue to rise
Housing crisis worsens for Yuba-Sutter home market

The housing boom kept on busting during July, August and September as foreclosures jumped sharply compared with a year ago, according to figures released by a real estate information firm Thursday.

Sutter County foreclosures increased five-fold during the third quarter of 2008 compared with the same period a year ago, totaling 291 homes, according to figures from MDA DataQuick.

Yuba County foreclosures were also up but not as much.

Homeowners like Himant Pandit, 34, of Van Vleck Street, near Yuba City's western city limits, are seeing the trend first-hand as newer subdivisions sprout for-sale signs.

Pandit said he has seen six foreclosures on his street in the last three months. He lives in a KB Home subdivision where he purchased his 3,200 square foot home two years ago for $385,000.

"First it was all booming," said Pandit, a Yuba City High School graduate and truck driver, about his home town. "Now everybody's out, everybody's stressing."

Pandit is stressing himself

because he became ill with a heart ailment several months ago. He just got back to work and is struggling to make a $2,400 fixed-rate monthly mortgage payment on the home where he lives with his three children.

A friend just bought a similar model nearby on Jefferson Avenue for $220,000 which suggests Pandit could be "underwater" on his investment by $100,000 or more.

"This is somewhat of an investment for me, but it's upside down now," said Pandit.

Pandit has reason to stay —a $75,000 down payment. But others who don't have equity in their homes are just packing up and leaving, even taking the light fixtures and garage door opener with them as the previous owners did from his friend's house.

The glut of inventory from foreclosures plus short sales is causing downward pressure on home prices, said David Burrow, president of the Sutter-Yuba Association of Realtors.

He said the inventory of homes has been accumulating beyond the number sold. Some 50 percent to 70 percent of the area's sales are short sales and defaults.

"We're actually accumulating them faster than they're selling them," said Burrow, a Realtor who is with Keller Williams Realty Yuba Sutter.

Some buyers are investors. Others are locals who held back on buying a home and now can get in cheaper.

He said people should contact their lenders if they are having problems with mortgage payments.

MDA DataQuick said foreclosures have emerged as a major market factor, accounting for 47.6 percent of all California resale activity last quarter. It was 9.5 percent a year ago.

Many are looking to the MDA DataQuick figures on default notices, the first step in the foreclosure process, in hopes for a sign that the vicious cycle was abating.

The surge in foreclosures may be leveling off. Fewer default notices were issued in the third quarter than in the previous two quarters in Sutter County, Yuba County and statewide.

But it was unclear whether the drop in notices was from slowing foreclosures, or because of a new state law that took effect last month requiring lenders to contact homeowners and wait 30 days before issuing default notices, said MDA DataQuick. The next quarter's figures may tell.

If foreclosures are slowing, Lee Pliscou hasn't noticed it yet. Pliscou, directing attorney of the Marysville office of California Rural Legal Assistance Inc., a nonprofit, said his phone has been ringing off the hook from people calling because of foreclosure problems. A workshop in Marysville Thursday on foreclosures drew 28 people.

"We're getting dozens of calls a day, and we cannot begin to meet the demand for housing services to deal with the foreclosure issue," said Pliscou.

Foreclosures

COUNTY 3rd Quarter 2007 3rd Quarter 2008 Increase

Sutter County 58 291 401.7 %
Yuba County 108 297 175.0 %
California 24,209 79,511 228.4 %

Source: MDA DataQuick

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