How many California Foreclosures will there be?

The news has spread there will be foreclosures in the state of California. First of all foreclosures happen in any market. There have been many news reports that California foreclosures are up 200%. Well what they fail to mention in that amazing headline is the fact that they have been extremely low in the last several years as a result of the market that existed here. So just how many California foreclosures will there be? Well that is the millionaire dollar question. We will try to answer it as best we can.

First what we believe won't happen:

• Foreclosures will not be 50% of the overall market - Unemployment is still very low and the government seems to be doing an adequate job to assist the lending institutions.
• Homes will not sell for 50 cents on the dollar - Let's be clear about this. If you were thinking that you were going to pick up the million dollar ocean front home for 50 cents on the dollar please know that just isn't going to happen. The economy is still going forward and certain areas are still selling within days and that includes the ocean front properties.

What probably will happen

• Foreclosures and/or short sales will make up at least 5% of the market - now that is still a large number of homes.
• 10% off of what the bank owns will be common - let's be clear we don't mean that the market will fall 10%. What we do mean is some people were able to finance their homes above the actual value of the property and the banks will be taking less than they financed for. In some cases the value will be far greater than 10%.

So just how many California foreclosures will there be? Well there will be a few. If you are serious about buying you can find a deal besides a foreclosure. If you still would like to sell you can still do that as well it just means you have to make sure to understand what is happening in your neighborhood.