Foreclosures in Los Angeles Highest in the Nation

by Peter Vernon on Foreclosures

Foreclosures in Los Angeles marked the highest foreclosure total posted by a U.S. metro area in the first quarter this year.

A total of 59,293 foreclosures were posted in the first quarter in the Los Angeles area, the second largest metropolitan area in the country. The foreclosure rate in the area, however, was one filing for every 75 residential units, lower than 31 other large metro areas.

Las Vegas, the metro area with the highest rate of foreclosure, posted one foreclosure filing in the first quarter for every 28 homes. The other California cities with high foreclosure rates were second-ranked Modesto, which posted one foreclosure for every 34 households; and Riverside and Stockton, which both posted a foreclosure rate of one in 36 and tied for fourth place.

Buying bank owned foreclosures in Greater Los Angeles is a good decision for investors, as the increased number of foreclosure inventory means more choices and the recent increase in home prices means greater possibilities of earning more from foreclosure investments.

Despite increases in foreclosures in Los Angeles, the S&P/Case-Shiller price index for the metro area climbed up by 0.6 percent. Over the past year, prices in the area jumped up by a total of 5.3 percent.

The industrial property sector in Los Angeles also improved despite the surge in distressed properties. The industrial vacancy rate rose slightly to 3.4 percent in the first quarter, but the rate was far below the national 10.9-percent vacancy rate. Nationwide, vacancies in the industrial sector have been rising for the past ten quarters.

Other California cities which posted prices increases on the S&P index were San Francisco, which posted the highest gain at 11.9 percent, and San Diego, which posted a price increase of 7.6 percent.

The cities which posted the highest declines on the index were Las Vegas, New York and Seattle.

Similar to the Los Angeles foreclosure trend, the pace of California foreclosures also stepped up in the first quarter. With 216,263 foreclosure filings and a foreclosure rate of one in 62, California ranked fourth in charts of foreclosure houses by state during the first quarter. The filings marked an increase of almost 5 percent from the previous quarter, but marked a drop of 6.4 percent from the first quarter in 2009.

Of the more than 216,000 filings, 21.5 percent or a total of 46,445 were bank owned homes and a big portion of these homes were foreclosures in Los Angeles.

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