The number of foreclosures on deeds of trust in Spokane County fell in 2004 for the second straight year, and to the lowest level in six years.
With the regions employment outlook improving and home prices rising, the number of foreclosures here likely will fall further, says Randy Barcus, chief economist for Avista Corp., of Spokane.
I expect it will decline by at least half this year, he says.
The Spokane County Auditors Office recorded 816 foreclosures on deeds of trust last year, down 27 percent from the 1,030 foreclosures here in 2003.
Last years foreclosure activity was the lowest since 1998, when the county recorded 658 foreclosures, and it marks the first time since 1999 that the number of foreclosures hasnt crested 1,000.
Two economic factors likely have assisted the drop in foreclosure activity, Barcus says.
First, the residential real estate market in Spokane County has become more bullish in recent years. According to the Spokane Multiple Listing Service, the number of homes sold through the MLS in 2004 increased by 6 percent, and annual sales volume crested $1 billion for the first time. Also, the median sales price of homes here climbed to $129,000, up 8 percent from 2003.
Barcus says a healthy real estate market often affords people the option of selling their homes before theyre foreclosed onand for more than they owe on them.
In addition to a vibrant real estate market, the job outlook brightened in 2004.
According to preliminary state figures, employment in Spokane County rose by 4,000 jobs in December, compared with December 2003. Also, the unemployment rate here fell by more than a percentage point in that month, to 5.6 percent.
That takes away pressure on the income side, Barcus says. Peoples homes get foreclosed on because they dont pay. When people are working, they are more able to pay.
While the number of foreclosures is on the decline, it isnt dropping as quickly as it has during past economic up cycles, Barcus says. Twice in the 1980s, the number of foreclosures peaked, then fell by half within two years.
Had the most recent drop followed that trend, as some local economists had expected, the number of foreclosures would have been closer to 575 in 2004about half of the 1,153 peak in 2002.
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