So far, most foreclosures have been in outlying areas that attracted first-time home buyers. But repossessions are on the rise in more established neighborhoods, including affluent communities.
Malibu and Beverly Hills had one foreclosure each in the second quarter of 2007. This year, Malibu had eight and Beverly Hills had seven, according to DataQuick.
For The Record
Los Angeles Times Saturday, July 26, 2008 Home Edition Main News Part A Page 2 National Desk 2 inches; 64 words Type of Material: Correction
Home foreclosures: An article in Section A on Wednesday on home foreclosures said the number of homes repossessed in California in the three months ended June 30 increased 33.5% from the same period last year. The increase was from the first quarter of 2008. The article also said that DataQuick Information Systems began tracking foreclosure data in 1992. The firm's tracking began in 1988.
There were 26 foreclosures in Newport Beach and Newport Coast combined for the second quarter this year, up from 10 a year ago.
Although these numbers are relatively small, Leamer said, the slump hitting the broader market will drag down values just about everywhere, in part because depressed prices discourage homeowners from selling and trading up.
"Prices are not going to recover soon, that's for sure," Leamer said.
In Washington, meanwhile, lawmakers put the finishing touches on housing relief legislation that would give the Treasury Department the go-ahead to increase its line of credit to Freddie Mac and Fannie Mae and buy stock in the companies, if necessary.
The federally sponsored mortgage firms, which own or guarantee nearly half the nation's mortgages, are reeling from loans gone sour.
In a report Tuesday, the Congressional Budget Office said Fannie Mae and Freddie Mac stand a "better than 50% chance" of weathering the housing and mortgage crisis without a government rescue. But the CBO also said there was a chance the firms could require as much as $25 billion in government aid.
"Many analysts and traders believe that there is a significant likelihood that conditions in the housing and financial markets could deteriorate," the CBO said. "Such continuing problems would increase the probability" that the bailout would be needed.
That prospect has made some conservatives wary. But after hearing the latest cost estimate, Sen. Judd Gregg of New Hampshire, the top Republican on the Senate Budget Committee, said the $25-billion figure will "pale in comparison to our long-term costs if we do not address this problem now."
The House Democratic leadership defended the measure, saying it has taxpayer protections, including letting the Treasury secretary delay dividends to Fannie Mae and Freddie Mac shareholders if the government must rescue the companies and permitting a new regulator to restrict compensation for the firms' executives.
