This is the percentage of traditionally safe prime-rate fixed-rate mortgages that are behind on payments in the U.S. and California. As you can see, it's quadrupled in two years in California. While 4 percent is not a disaster, the experts say it's really, really high compared to historical averages.
Q1 2.19% 0.98%
Q2 2.25% 1.07%
Q3 2.54% 1.43%
Q4 2.56% 1.73%
Q1 2.82% 1.50%
Q2 3.07% 1.92%
Q3 3.35% 2.60%.
Q4 3.92% 3.70%
Q1 4.68% 3.94%
Source: Mortgage Bankers Association
This is likely to worsen in a Sacramento region (Sacramento, El Dorado, Placer and Yolo counties) that has lost an astounding 45,000 jobs the past year and a California that has lost 739,000 the past year.
Sacramento, too, is a company town heavily reliant on state government. You've seen the scene there. Three furlough days, the governor threatening another 5 percent wage cut and both sides at apparent impasse over how to wrestle that deficit. Given that many households here have two incomes tied to the state this is increasingly tough on the mortgage payment.
Meanwhile, here is another AP story saying that rising unemployment is starting to scare away would-be homebuyers.