Is the Worst of the Foreclosure Crisis Over?

A story in today's Daily News suggests that the worst of the foreclosure crisis may be behind us, at least in the San Fernando Valley. According to a report by the San Fernando Valley Economic Research Center at California State University, Northridge, notices of default - the first step in the process - plunged to 903 from 1,234 a year ago and 999 in January.

The number of homes lost to foreclosure was also lower in February. The survey found that foreclosures fell last month to 409 properties from 450 a year earlier and 424 in January. Foreclosures are now down 55.5 percent from the record monthly high of 919 in June 2009.

Economist Nancy Sidhu, Director of the Kyser Center for Economic Research in Los Angeles, said that this is an encouraging sign since the number of default notices foretells foreclosure activity in the coming months.

If this is not simply an issue of banks holding off (issuing notices). It suggests we're on the far side of that mountain and that's all to the good.

Of course, all the news wasn't good. Valley home sales fell in February for the eighth straight month as 973 new and existing houses changed owners, down 13 percent from a year earlier and 10.5 percent from January.

But in another glimmer of good news, the median price rose slightly to $378,000 from $370,000 in January and $375,000 a year earlier.