Bexar foreclosures down to a 2-year low

 

Rachel Stone
Express-News Business Writer While the U.S. housing industry struggles under the weight of the some of highest delinquency and foreclosure rates on record, Bexar County and Texas are enjoying a bit of a dip in foreclosure rates — but not for long.The number of homes up for foreclosure in Bexar County next month is down to the lowest level in two years, according to a report released Friday.

Next month, 606 homes will be sold at the Bexar County foreclosure auction, according to the Addison-based Foreclosure Listing Service Inc. That’s down 18 percent from 737 in June and down 3 percent from 623 July 2006.

The picture is even brighter in the rest of the state. In the 20 counties across Texas that the Foreclosure Listing Service tracks, the number of homes posted for foreclosure auction is down 35.6 percent to 4,665.

These recent numbers are in stark contrast to the seemingly dire foreclosure situation in the rest of the country.

The Mortgage Bankers Association reported Thursday that the percentage of late payments 30 days or more past due on subprime adjustable-rate mortgages jumped to 15.75 percent in the first three months of 2007, which is the highest percentage on record.

Nationally in May, there were 176,137 foreclosures, up 19 percent from April and up 90 percent from May 2006, according to RealtyTrac, an online listing service of foreclosures. That’s the highest number since RealtyTrac began tracking foreclosures in 2005.

It’s still unclear what July’s foreclosure dip might mean for a state that has had one of the country’s highest foreclosure rates for months.

In May, Texas had the third-highest number of foreclosures with 11,012 filings, according to Bargain Network, an online listing service of foreclosures.

But in Bexar County, the Foreclosure Listing Service characterized the July downturn in Central Texas as an “ebb” and an “anomaly.”

The year-to-date number of foreclosures is still up in Bexar. So far this year, there have been 5,210 foreclosure auction postings, 6 percent more than at this point last year.

The Foreclosure Listing Service still isn’t changing its long-term forecast that foreclosures in Bexar County will continue to rise.

But the foreclosure dip could be related to the strong home price appreciation in San Antonio and Texas, said research economist Jim Gaines of the Real Estate Center at Texas A&M University.

“When prices go up, lenders don’t get in as much trouble because (homeowners) are able to refinance or sell the house to cover the loan,” Gaines said.

Home prices in the San Antonio and Austin areas appreciated an average of almost 11 percent in the first three months of 2007 compared with the previous quarter, according to the government’s Office of Federal Housing Enterprise Oversight. Statewide, the average was about 7 percent.

That’s much better than the national average for home-price appreciation, which increased just 0.5 percent in the first quarter, according to the OFHEO.

Big trouble starts when home values decline, which is happening in Arizona, California, Florida and Nevada — four of the seven states with the highest rates of foreclosure, Gaines said.

Lenders also could be reluctant to foreclose on loans in certain markets because foreclosure isn’t profitable, Gaines said.

“They’d rather work something out so the borrower doesn’t lose his home and the lender has a performing asset on his balance sheet,” he said.

Armando Barbosa, who owns Vision Mortgage Co. in San Antonio, has seen that in this market.”I know of some companies that are being pretty patient with buyers, so that could be an industry trend,” he said. “They could be delaying foreclosure if it seems like there’s light at the end of the tunnel.”

But he agreed with the Foreclosure Listing Service’s “anomaly” characterization.

Interest rates are growing higher, and he still sees clients wishing to get “bail-out” loans to prevent foreclosure.

“Everything points to quite the opposite of what these numbers are showing,” he said.

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rstone@express-news.net

Gilbert Estrada

210 421 6344

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