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Thursday, Jan. 14, 2010

Grim real estate statistics: Merced County leads state in foreclosures, #6 in nation

In 2009, 1 out of 10 properties got bank repossession filings

One out of 10.

That's how many properties in Merced County got foreclosure filings last year.

The grim numbers thrust the county into the top spot for the state of California, according to a new report by RealtyTrac.

Last year, 8,389 properties here received foreclosure filings -- which include default notices, scheduled foreclosure auctions and bank repossessions.

That's up slightly from the 8,291 foreclosure filings in 2008.

Both figures are light years above the 743 foreclosures filed in 2006.

Nationwide, a total of 3,957,643 foreclosure filings were reported on 2,824,674 properties in 2009 -- a 21 percent increase in total properties over 2008.

Merced has the sixth-highest countywide foreclosure rate in the country. The county with the highest rate was Osceola County, Fla., where one in every eight housing units received a foreclosure filing in 2009.

"I'm tired of being No. 1," said Merced Mayor Bill Spriggs. "It's not a fun time right now."

Spriggs said he wasn't surprised by the county's presence at the top of the foreclosure rankings.

"I think this market was way too speculative," he said. "When the downturn hit, I think we were more impacted than other markets. We had lots and lots of out-of-area investors which really compounded things, too."

RealtyTrac reports countywide numbers. Spriggs said the city has about 750 vacant homes right now, measured by the number of homes that have canceled garbage service.

About 215 homes in the city are up for sale right now.

"So you know the numbers don't add up. Lenders are holding foreclosed homes off the market. If they flooded the market, it would really hurt value," Spriggs said.

County Assessor Kent Christensen said banks had taken over 4,471 property rights from owners in Merced County in 2009. That number could still rise because of home sales at the end of December, but will fall short of the 5,795 county homes that went back to banks in '08.

Nevada, Arizona and Florida posted the top state foreclosure rates in 2009. California, Florida, Arizona and Illinois account for 50 percent of the total national foreclosure filings.

A total of 632,573 California properties received a foreclosure filing in 2009. While Merced posted the highest rate statewide, nearby counties weren't far behind. San Joaquin County had the third-highest foreclosure rate, with 8.62 percent of homes with some sort of filing.

Stanislaus County was ranked fourth in the state with an 8.53 percent foreclosure rate and 14,812 homes headed back to the bank. One of every 12 homes there received a foreclosure filing last year.

(San Joaquin and Stanislaus are also the only two counties in California to experience a drop in foreclosure rates in 2009, compared to the year before.)

James J. Saccacio, CEO of RealtyTrac, said the numbers paint a more optimistic picture of the housing market than the reality stalking the streets.

"As bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans," he said.

Saccacio explained that foreclosures ebbed after July because more distressed homeowners began receiving loan modifications.

Plus, a state law put off foreclosure actions on borrowers who were behind on payments.

"In the long term a massive supply of delinquent loans continues to loom over the housing market, and many of those delinquencies will end up in the foreclosure process in 2010 and beyond," Saccacio said.

A total of 21,154 properties received some foreclosure filing in Merced County since 2006, according to RealtyTrac.

Homeowners in need of help can contact No Homeowner Left Behind of the Central Valley at (559) 221-6919. The organization is a nonprofit and is approved by the United States Department of Housing and Urban Development for foreclosure prevention programs.

Reporter Danielle E. Gaines can be reached at (209) 385-2477 or dgaines@mercedsun-star.com.