We hear nearly everyday about the growing number of foreclosures in our country, particularly in boom-and-bust markets like Los Angeles. This chart provides a historical picture that shows what a unique moment we are in.
In the last LA housing bust during the early 1990s, foreclosures doubled from under 15,000 in 1992 to over 33,000 in 1996 and 1997. As the economy boomed, the number of foreclosures declined steadily to under 1,000 by 2005. That eight-year decline was reversed in three quick years, with 2008 skyrocketing to nearly 40,000 foreclosures.
The early part of this decade looks like a nice, slow coast downhill. Too bad we didn’t put on the brakes; maybe we could’ve avoided this current steep uphill climb.
2 thoughts on “Los Angeles Foreclosures”
This chart confirms that the significant increase in foreclosures was not the result of a slowing economy or recession (that didn’t start until Dec. 07 at the earliest) — it was the result of folks getting mortgages that exceeded their means/the value of their homes. Easy credit was the problem, compounded by irresponsibility by (some) borrowers.
Living within your means, paying off/avoiding debt, and saving for a rainy day are time-proven measures for success. Taking on a mortgage you can’t repay is a recipe for disaster.