Last month I had thought we may have hit the top of the wave of foreclosures.  We had not.  During June 2009 there were 486 filings of trustee sales.  At that rate there would be nearly 6,000 foreclosures per year in Clark County Washington.

Following is the graph of the numbers.  This graph covers the last year.  You can look at previous graphs in these posts to see the activity since the beginning of 2005.  About 65 foreclosures per month was the norm in 2005 and 2006.  The average, since the beginning of this year, is 405 per month.  That is 6.23 times the norm before the economic downturn began.

Since June 2008 the foreclosure rate has increased over 98%. Since January 2009 it has increased almost 36%.  The general trend is about an 8% per month increase over the last year.

On another note, there appears to be a glimmer of good news.  When we do appraisals we have to look at the trends and do statistical analyses on every FNMA appraisal we do.  There has been an almost consistent rate of decline in the 1% to 3% per month range around the county (with some exceptions).  During the last month I have found a number of areas where the statistical analysis showed a flat market, i.e. no decline in the market during the last six months.

This is a good sign, though a small one scattered around the county.  However, with the continued rise in the number of notices of trustee sales the amount of bank owned property will continue to weigh prices and values down.

Until this excess REO (bank owned property) flushes out of the system, prices and values will stay low.  I said it before, that is a lot of work for the economy to do.

Ralph K. Olsen

Pacific West Appraisal Services, Inc.

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