The WeBuyTucsonHomes Blog

This past week saw a low in the Notice of Default(NOD) filing in Pima County.  Only 116 notices were filed, however 85706 received 19 of those notices.  The Zillow estimate of those homes comes in around $19.9 million, while the 1st lien position comes over $20 million dollars.  Add in the usual 15% second and the total encumbrance adds up to $23 million.  Meaning this past weeks homes are very underwater and unlikely to sell unless a large short sale is negotiated with the lenders.

Here is the chart.

The week of Nov 24-28 saw a low number of N.O.D.s filed in Pima county, but because a large “retirement home” missed a few payments, the total dollar amount of first mortgages ran over $74 million dollars.  The retirement home contributed over $45 million dollars in mortgages to the total, because of that the $45 million will be taken out in the calculations below.

The number of filings were down presumably to the short holiday week, but a surprising number of “luxury ($500,000 and up)” homes fell into default.  Usually one or two homes will fall into default every couple of weeks; the past week saw 8 home.  Following what many financial analysts have been lamenting, a couple of commercial buildings were found to be on the list.  The amounts were relatively small at only a few million dollars, but if the trend continues we could see discounts coming in commercial buildings and more cheap office space for rent.

A total of $29.1 million dollars were in default, not including the $45 million from the retirement home, with a Zillow value of $26 million dollars.  This was the first time in running this list that the values were more than the first mortgage.  This could have devastating effects on the banks holding the notes.  Usually in a short sale the banks will discount or remove the second mortgage to help facilitate the home sale.  However, if the home is now worth less than the first mortgage, banks may be even less inclined to negotiate and favor to take the home back(foreclose) rather than take a chance on a definitive short sale loss.  It will be interesting to see if this trend continues.

Further, this week I noticed more properties held 2nd mortgages in excess of 15% of the first mortgage.  The 15% standard 2nd mortgage will not be increased, but is of interest as the amount of 2nd mortgages could be much higher.  Also 85746 outpaced 85706 14 to 13 in NOD filings marking the first tim85706 has not lead the way in homes in default.

So here is the chart.(Upgraded to Office 2007 so the charts are “prettier”  :))

116 Notice of Defaults for Pima county

Sorry for being a little late, the holiday season seems to always come with a bang.

Pima county recieved 202 notices of default during the week of Nov 17-21.  This number has been steady with a variance of 10% give.  This number hasn’t been changing much even with all the press releases of banks suspending foreclosures, and many businesses popping up to help with the loan modifications.  It makes one wonder how successful the banks are in negotiating a loan restructuring.

To the numbers!  201 NOD’s were filed with a first lien position of roughly $39.5 million dollars in loans going bad.  Add a 15% average 2nd position($5.925 million) and the total balloons to $45.5 million dollars in bad loans.  According to Zillow,  the property totals are worth ~$41.3 million dollars.  A difference, if the houses were to sellat Zillow estimates, of $4.2 million dollars.  Not a large sum but if that figure added up over a year it would look at $200 million dollar shortfall for the banks.

201 NOD filed in Pima County Nov 17-21

Nov 10-14 Pima County recorded 127 Notice of Sale documents against homeowners this past week. First mortgage loans totaled roughly $23.5 million vs $25.5 million in value(Zillow Estimates). Applying the same 20% average second mortgage against every home gives a total of $27.7 million owed vs $25.5 million in value. This means the average foreclosure home is 8% “underwater” this past week, better than last weeks average of 20% underwater.

Once again 85706 led the rankings with 12 filings, 85746 was second with 11, and 85629 was third with 9.

This past week Pima County listed 185 Notice of Sales filed for the week of November 2-7. The first mortgage on the properties totaled roughly 34.4 million vs property values according to Zillow of 34.7 million.  Now remember this is only the first mortgage position and all most all of the properties list 2nd and sometimes 3rd positions. The second position can vary anywhere from 5% all the way up to 40%. Take a low end average 20% and the liens against the properties increase to over 41.2 million. This puts almost all the properties 19% “underwater.” Now factor in that Zillow maybe overestimating housing prices and some home owners could be even further underwater!

Looking at the chart we see 85706 again led the way with 24 notices filed. 85746 was second with 19 and 85711 was third with 14. Some interesting things to note were a few large real estate investing companies, both national and local are seeing notices filed against properties they own. Why do I mention this? They were speculators in some instances, as the filings were on very new and high priced homes, and also to show that the financing crunch paired with the downturn in housing is hitting everyone hard.

Here is the chart with 185 Notice of Sales for November 2-7, 2008

I thought it would be interesting to post the weekly statistics from the notice of sale list. This is a list that I comprise every week, via the Pima County Recorders Page. The data is collected by counting the “Notice of Sales” and associating the address with the correct zipcode. (Note that there is more than one way to file for a foreclosure in Pima County, but Notice of Sales are used for Deeds of Trust, which is the most common lien banks use.) Thus this is not a definitive number, but should be a reasonably accurate number based on my data gathering techniques. More data will be added in the coming weeks, and a chart of all 2007 notice of sales is in the works.

The past week saw 158 “Notice of Sales” filed, valued at roughly $30 million dollars in property. (Note that I only calculate the value based on the first mortgage. So if a home is encumbured by more than one lien only the first lien is used. Thus this number could be undervalued by up to 30% or more. A high degree of error, but at this time the data gathering methods do not allow for more accuracy. This will be something I will continue to work on improving.) Continuing trends include: over 95% of the deeds of trust entering foreclosure where originated in 2005-2007, the highest concentration of filings occur for the 85706 zipcode, and areas of new home developements show increasing numbers of foreclosure starts.