According to RealtyTrac, last year at this time, Merced had the third highest foreclosure rate in the country, behind Las Vegas and Modesto. But now, the top two remain the same, while Merced has dropped to tenth on the list.
Merced was hit especially hard by foreclosures when the housing crisis started and all those out of town investors who came as U.C. Merced was being built, bailed. But now realtors say that flood of foreclosure activity seems to be slowing down.
It's still not hard to find foreclosed homes in Merced. In fact, RealtyTrac reports one in every 195 homes in the city received a foreclosure filing just last month. But local realtors say it's not as bad as when the housing crisis started.
Sheila Splitt said, "We had a huge amount at one time, that it was just a floodgate. So I think most of them we've gone through."
Splitt says those that are on the market are also selling more quickly because of increasing demand and prices she believes are at rock bottom. "A house that I had that I listed for $26,000, it had sold in 2006 for $200,000."
Residents are also noticing fewer abandoned homes in their neighborhoods.
Josh Fleming said, "It's starting to pick up a little bit. Houses are starting to sell."
Servando Vale said, "I've noticed they've been selling quite a bit over here. And there's only one or two I've noticed that haven't sold."
Vale moved into this North Merced neighborhood one year ago when several of the homes on his block were in foreclosure. But he says the low prices quickly brought in buyers, including himself.
Vale said, "I did get a good price on it, and it was a foreclosure, and that's one of the reasons I bought over here and I moved here. And I like it. I have no regrets whatsoever."
But RealtyTrac says the numbers are not all good news. The company attributes a 40 month low in foreclosure activity nationwide to massive delays in processing foreclosures, not a true housing recovery.
Splitt said, "The banks were not releasing their foreclosures. So if they're not releasing them or recording them, then obviously that number would go down. But I think you'll see it go back up."
RealtyTrac says the average time it takes to complete the foreclosure process in California right now is 330 days. That's nearly 70 days more than the same time last year.
