61,200 Californian Households Say ‘Very Likely’ to Lose ‘This Home’ in Next 2 Months

By Tim Shaler
Tim Shaler
Tim Shaler
Tim Shaler is a professional investor and economist based in Southern California. He is a regular columnist for The Epoch Times, where he exclusively provides some of his original economic analysis.
September 17, 2021 Updated: September 19, 2021

Commentary

Californians behind on their mortgage payments are 32 percent more concerned about losing their home to foreclosure in the next two months than the nation as a whole.

All else equal, California will have the highest number of Americans at anything.

On April 1, 2020, 12.0 percent of all Americans were residents of California (including people living overseas who maintain their California residency).

That means, again, all else equal, or as economists might write, ceteris paribus, Latin for “holding all else constant,” people should expect Californians to represent 12 percent of all the people for anything that is true about Americans more broadly.

So it’s not surprising Californians represent 12.2 percent of all people identified by the US Census Bureau this month as being late at least one month on their mortgage payments.

About 876,000 Californians, out of about 7.2 million Americans, were identified this month as being at least one month late in their mortgage payments.

However, of those 876,000 Californians at least one month behind in their mortgage payments, some 61,000, or 15.4 percent, think it is “very likely” they will have “to Leave this House in Next Two Months Due to Foreclosure.”

Outside California, only 5.3 percent of Americans who are behind on their mortgage payments think it’s “very likely” they will have to vacate their homes within two months. Two months from now is one week before Thanksgiving.

All 61,000+ Californians, literally all, identified by the Census as “very likely” to have to move out of their homes due to foreclosure in the next two months are at least 8 months past due in their mortgage payments. (Of course this result that all Californians worried about being kicked out of their homes due to foreclosure are at least 8 months behind in their mortgage payments is likely some sort of statistical anomaly, but it’s instructive that Californians may be much more behind in their mortgage payments than Americans more generally.)

The 61,000 Californians who think it’s “very likely” they will have to move out in the next two months are 7.0 percent of the 876,000 Californians identified as being at least one month behind in their mortgage payments.

Seven percent of California’s delinquent mortgage borrowers being worried (“very likely”) they will have to leave their homes in the next two months demonstrates a 32 percent higher level of concern among Californians than among their counterparts in the rest of the country.

One residential real estate agent at least, Valerie Voss, in the Inland Empire of Riverside and San Bernardino counties in southern California, thinks any new supply of homes for sale being made available by people selling their homes to avoid foreclosure might relieve some of the upward price pressure in home prices all Californian suburbs have experienced since the beginning of the pandemic.

61,200 households would be just under 180,000 Californians having to find a new place to live, using the average California household size of 2.94 persons per household.

Of course, much of the recent recall effort to recall California’s governor was originally fueled by grassroots people angered about forced closure of their businesses and the state’s poor water management policies. As the campaign went on, though, some candidates for governor sought to make the election about other things, including California’s terrible housing shortage and very high cost of housing. With the next California election for governor only 14 months away in November 2022, if people start losing their homes, housing may very well be an important topic in the next gubernatorial election in the state.

Tim Shaler
Tim Shaler is a professional investor and economist based in Southern California. He is a regular columnist for The Epoch Times, where he exclusively provides some of his original economic analysis.