I just took another look at Altadena.  There are 29 bank owned properties, 87 properties have received Notices of Default and 155 are scheduled for auction by the lender; these are of all property types (eg. single family homes, condos, duplexes, etc.).

In contrast, there are 148 residential properties currently on the market, either active or in escrow.  They range from just having gone on the market yesterday to having been on the market for 285 days; prices range from $190,000 to $2,475,000. Of the 29 bank owned properties 21 are either available or in escrow, the others have not yet hit the market.  Of the remaining 230+ distressed properties only thirty are on the market.  What we’re looking at is a pool of distressed home owners that have not taken action to resolve their dilemma which is substantially larger than the entire active market.

All indications are that the banks are stepping up their process to take action on these delinquent loans.  I’m cautious about saying that the foreclosure tsunami is about to hit, as I’ve said that before and been wrong, mostly because the banks were trying to hide the depth of the problem and the government was interfering with the market process with moratoria and and bad incentives.  All these distressed properties are going to have to come to the market sometime.  When they do the law of supply and demand will operate and force prices down.  Add to that the fact that the economy in CA sucks right now, with no upside in sight, reducing the pool of potential buyers, which will also push prices down.

Numbers don’t lie. If you hope to buy and leverage maximum advantage from your home purchase, I’d say hold your ground, keep your powder dry and wait, if you are in a position at all to do so.  If you’re going to sell, do so now while before values fall off the cliff.

Particularly I’d say to people in distress, be brutally realistic about your situation.  Talk it over with a Realtor (not your plumber, not your brother-in-law’s veterinary’s sister’s  hair dresser) whom you can trust, not one that’s going to blow smoke, and explore your options.  Bearing in mind that hope is not a strategy, make strategic plans for your future.  Take action and follow through as quickly as possible.  The sooner you act the sooner you’ll get back on solid ground.

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