Since October 2006 when the Adams County Housing Authority joined in a statewide foreclosure prevention effort, local housing counselors have helped 2,000 clients avoid foreclosure in some capacity. The $370 million dollar volume is based on an average of $188,349 per loan. That is almost 10 percent of the $4 billion in mortgages saved since the Colorado Foreclosure Hotline, 1-877-601-HOPE, was launched.

Cost-effective solution

Executive Director Don May today shared the impact to the local economy with his housing counseling team.

“The team of housing counselors we have here in Adams County have been working diligently with homeowners across the county and with lenders across the country to insure the impact from this current foreclosure crisis is reduced as much as possible,” May said. Not only is $370 million a big number, but it is cost-effective, as the cost of the program is typically less than $300 per homeowner, May said.

“Knowing that the costs of this foreclosure prevention program can be leveraged to net such an amazing rate of return is an important rebuttal to those who would say let the homeowners fend for themselves,” May said.

Homeowners in Adams County can receive free housing counseling to avoid foreclosure from the Adams County Housing Authority either through a bi-weekly workshop or through individual counseling.

$4 billion savings statewide

In $4 billion overall savings, including the $370 million in Adams County, are important to the overall housing market, as providing important social and psychological benefits, said economist Patty Silverstein.

“Assuming that, indeed, these numbers are correct, I think that the impact on the entire metro region economy is quite significant,” said Silverstein, principal of Development Research Partners in Littleton. “First, it has helped to keep our home prices relatively more stable than in other parts of the country. But beyond that, it is just good for the overall economy to keep people in their more and not have them lose it. It plays into everything from the individual family’s psyche to helping them re-allocate their spending patterns. If they can keep their home out of foreclosure, they can remain productive contributors to the economy. How you put a value on that is hard to measure. But it certainly helps the overall market remain stable.”

Foreclosures infect like a fast-moving virus

When homes fall into foreclosure, it not only hurts individual households, but the homes around them, which can bring down the value of entire neighborhoods. Empty homes can become magnet for crime and graffiti, for example.

“Certainly, if someone loses their home in foreclosure, there are lots of negative multiplier impacts,” Silverstein said. “I’m not sure you can say that is moves you into a positive realm as far as multipliers if their homes do not go into foreclosure. I think it is more of a case of maintaining one’s positive momentum.”

Advice free to consumers

U.S. Department of Housing and Urban Development–approved housing counseling agencies,such as the Adams County Housing Authority, offer free advice for homeowners who are facing financial difficulty and are concerned about losing a home to foreclosure. Housing counseling uses solution-based methodology to find the most sustainable option for each individual homeowner, including loan modification; short sale; forbearance and repayment plans; and other potential workouts.

Housing counselors also assist borrowers in communicating with mortgage companies regarding hardship and potential workout options. Many national lenders have given housing counselors at the Adams County Housing Authority special phone numbers to call when they have a client who needs their case escalated beyond general customer service.

For more information on the Adams County Housing Authority, visit www.adamscountyhousing.com.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865

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Source: Standard & Poor’s and Fiserv for 2009

The Denver metro’s housing market ended last year with a 1.2 percent year-over-year gain, the best showing in 2009, according to the closely watched S&P/Case-Shiller Home Price Indices released today.

However, the one-year change  in December was good for only fifth place of the 20 cities tracked in the index, as other cities also showed even larger one-year gains in December. San Francisco was No. 1 with a 4.8 percent gain. Dallas, San Diego, and Washington, D.C., also showed larger gains than Denver.  Las Vegas, by contrast, showed a 20.6 percent one-year drop.

Still, some local real estate officials said the jump is a good sign that the Denver housing market is on the road to recovery.  It was only the second time that Denver was in positive territory in 2009  from the same month in 2008. In November, the one-year change was 0.5%.

“Wow, that is huge,” said Mike Rinner, of the Genesis Group, which tracks housing along the Front Range. “I just stood in front of a crowd of 140 this morning and told them according to Case-Shiller we were up 0.5 percent and I expected that we would end the year at about zero. Boy, was I wrong.”

The Case-Shiller analyzes data from the same homes that have been re-sold, so it eliminates a bias of different homes in the sales mix, which can drive the average and median prices of homes up or down. For example, there have been so many distressed homes sold in Denver in recent years, that it drove the overall market down, while in more normal years, bigger homes entered the market, driving prices up.

Denver-area home market is healing

What the Case-Shiller study reflects the “healing” of prices at the lower-end, Rinner said.

“The greatest volume of home sales are occurring at the lower end,” Rinner said. “The values have been re-set as lower-end foreclosed homes hit the market, and there has been some appreciation from the lowest levels. If you look at the worst foreclosure markets in Adams, Denver and in Arapahoe counties, those markets have healed. Areas along the northeast corridor such as Green Valley Ranch and Montbello used to have the largest supply of unsold homes on the market, but now they have among the lowest,” as investors and owner-occupants have snapped them up at bargain prices.

By contrast, Rinner said not many sales are occurring in the higher price ranges and there is arguably a large over-supply of expensive homes on the market today.

But because of Case-Shiller’s methodology, it does not include the spec home constructed by a builder for $1.2 million, which never sold and is now going through the foreclosure process and likely will eventually be sold for $400,000 or $500,000, Rinner said.

“Also, at the upper end, owners are less inclined to take a hit, so they won’t sell it in today’s market if they don’t have to,” Rinner said. “So they are just sitting there until the market improves.”

Home values, not ranking, important

Rinner said that Denver’s drop in the ranking is not a concern. Because areas such as San Francisco have had such huge drops in the past, he said it is not a surprise that they may jump as they start emerging from the bottom.

Independent broker Gary Bauer said that the Case-Shiller showing reflects the price gains that have occurred in the Denver area during the past six months.

“It’s been a nice, steady upward movement,” Bauer said. “From my perspective, we were the first coming into it, and we will be the first coming out.”

But Bauer said he is a  ”little surprised that we dropped in the ranking. I didn’t realize that San Francisco is starting its recovery.”

Indeed, he is consulting with a person who three years ago bought a house outside of San Francisco for about $650,000. The owner then put another $300,000 into it. Now, he would like to sell it and move to the Dallas area to be closer to family.

But it’s not worth anything close to $1 million.

“Unfortunately, he bought at the wrong time of the real estate cycle,” Bauer said. “It’s worth maybe $650,000, max. I really don’t know what he can do other than just wait.”

Meanwhile, Bauer is working with a first-time buyer who hopes to take advantage of the $8,000 federal tax credit, which requires that the house is placed under contract by April 30.

“It’s a condo in northeast Aurora that the original owner bought for $143,000,” Bauer said. “We have it under contract for $90,000.”

Tax credit play role

But John P. Cochran, the Dean of the School of Business at Metropolitan State College of Denver, wonders if the tax credit for first-time buyers, which was extended in early November, may have skewed the numbers late last year.

“It’s hard for me, right now, to accurately interpret the numbers of November and December,” Cochran said. “People were uncertain whether the $8,000 tax credit was going to be extended, so there may have been some acceleration going on as we moved closer to that date when it might have expired. I’m guessing that may have caused a one-time bump.”

John Skrabec, the broker-owner of Live Urban Real Estate, said he thinks that the tax credit, which now requires a buyer to place a home under contract by April 30, did help the market late last year. Qualified current owners also have a $6,500 tax credit. The homes must be closed by the end of June to get the credits.

“I think that sales might be front-loaded to the first part of this year, because of the credits,” Skrabec said. “I am a little nervous about what is going to happen after they are gone.”

Still, he said the gain in the Case-Shiller report is an “encouraging sign.”

And he said it doesn’t bother him that some other markets jumped past Denver, although he was surprised that cities such as San Francisco and San Diego saw such big percentage gains.

“I think that is just the pattern that Denver has echoed over time,” Skrabec said. ‘We don’t usually have the biggest drops, but we don’t have the biggest increases, either. Our little chart doesn’t go up and down as some other cities.”

Also, he said that certain neighborhoods have shown much greater appreciation, from the bottom of the market, than the 1.2 percent overall gain reflects.

“Prices have gone up a lot in southwest Denver, in neighborhoods like Ruby Hill and Athmar Park,” Skrabec said. “They were beaten up pretty bad, and there has been a lot of investors fixing and flipping homes there. Prices have been going up. Most of the demand has been from the bottom up, and that’s all right. The market is gong to recover from the bottom up, not from the top down.”

And even higher-priced homes are moving in northwest Denver neighborhoods such as West Highland and Berkeley, he said. Neighborhoods such as City Park and Uptown, also are doing well. “But it’s still pretty tough outside of the city neighborhoods in the suburbs,” he said.

Denver housing up for 5 straight months

Chris Mygatt, president of Coldwell Banker Real Estate in Colorado, said that while the Case-Shiller report is a positive sign, he thinks the market is poised to recover even faster than its report shows.

“If you look at the MLS (Metrolist) data from January, it marked five consecutive months of average prices increasing in Denver,” Mygatt said. “We had not seen that in three years. That is in conjunction with the inventory down to 17,000, plus or minus, low interest rates, and the tax credits, we could be in store for a pretty decent rebound.”

Mygatt said he does not think there is much chance that the tax credits will be extended beyond their current expiration dates. But he thinks that will keep the government buying mortgage-backed securities to keep interest rates low.

Jeff Bernard, a broker with RE/MAX Alliance and principal of Bernard Real Estate Analytics, said his “hunch” is that San Francisco home prices rose so much is because wealthy foreigners took advantage of a weak dollar to buy houses there last year.

He said he thinks that Denver’s overall appreciation is probably caused by homes from $90,000 to $350,000, which have bounced from lower levels, which offset homes at the upper end that have been heavily discounted from their original prices. “I would imagine there would be a fairly large standard deviation if you broke the numbers down by price points,” Bernard said.

Still, Cochran said it is good news that home prices in Denver are moving in the right direction.

“Having a positive number is good, but certainly I have to look at it very, very cautiously as an indicator of where we are heading,” Cochran said.

Nationally, home values improve YOY

Overall, the 10-City and 20-City Composites continued to show improvement in their annual rates of return. In fact, all 20 metro areas and the two composites saw improvement in their annual returns compared to November’s data. Only three cities – Detroit, Las Vegas and Tampa – still showed double digit annual rates of decline as of the end of 2009. Miami, Phoenix and Seattle all moved above such rates with December’s report.

But the areas did not fare as well from November to December. Denver lost 0.8 percent, compared to a loss of 0.2 percent for the 20 cities in the index. Only three cities – Chicago, Cleveland and Dallas – showed bigger month-t0-moth declines than Denver.

“As measured by prices, the housing market is definitely in better shape than it was this time last year, as the pace of deterioration has stabilized for now. However, the rate of improvement seen during the  summer of 2009 has not been sustained,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “In the most recent months we are seeing fewer and fewer MSAs reporting monthly gains in prices. Only four cities saw month to month improvements in December over November, when you look at the raw data. We are in a seasonally slow period for home prices, however, so it is not surprising to see better statistics in the seasonally-adjusted data, where 14 of the markets and the two monthly composites all rose in December. Similarly, the National Composite fell by 1.1% in the fourth quarter, but rose by 1.6% on a seasonally-adjusted basis.”

Metropolitan Area	November-December Change	1-Year Change from December
Atlanta	-0.7%	-4.0%
Boston	-0.1%	0.5%
Charlotte	-0.7%	-3.8%
Chicago	-1.6%	-7.2%
Cleveland	-0.8%	-1.2%
Dallas	-0.9%	3.0%
DENVER	-0.8%	1.2%
Detroit	0.0%	-10.3%
Las Vegas	0.2%	-20.6%
Los Angeles	1.0%	0.0%
Miami	-0.3%	-9.9%
Minneapolis	-0.5%	-2.3%
New York	-0.7%	-6.3%
Phoenix	0.5%	-9.2%
Portland	-0.3%	-5.4%
San Diego	0.1%	2.7%
San Francisco	-0.2%	4.8%
Seattle	-0.7%	-7.9%
Tampa	-0.6%	-11.0%
Washington, D.C.	-0.2%	1.9%
Composite-10	-0.2%	-2.4%
Composite-20	-0.2%	-3.1%

Source: Standard & Poor’s, Fiserv

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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Later, experts said that without the Colorado Foreclosure Hotline, 1-877-601-HOPE, which has received more than 60,000 phone calls, has played a big role in stemming the tide of people losing their homes.

“We’re making good progress,” said Ryan McMaken, who released the report that showed a record 46,394 foreclosure filings last year, an 18 percent increase  from 2008, but only 20,437 foreclosure sales – a 4 percent drop from 2008.

“I think we are doing very well, especially in light of the 2009 foreclosure filings setting a record, but we still had fewer foreclosures being completed,” McMaken said.

Last year, a new state law required people who were facing to receive information about the foreclosure hotline. McMaken noted that there were about 19,000 foreclosure filings in the five-month period when the law was in effect last year, and the hotline received about 18,000 calls during that period.

He noted that some people would have called more than once and not everyone who called the hotline during that time period was just beginning the process. Still, it indicates that people are taking advantage of the free hotline, which is staffed by HUD-approved counselors.

“We know that 16,000 people who called the hotline have reached a resolution,” McMaken said. “If you added another 16,000 people to foreclosure sales, it would had a huge increase.”

Shannon Peer, who heads counseling for the non-profit Brothers Redevelopment, which manages the hotline, said without a doubt it is the single factor that made the biggest dent in the outcome of foreclosure, although he cautioned the state is still dealing with a “foreclosure crisis.”

And it typically takes a great deal of patience and persistence on the part of the homeowners, whether they are trying to get a permanent loan modification, a short sale, or something else.

“This is something that can take many months to resolve,” Peer said. “It is not something that is going to change in a month. It’s a long process. In some ways, it is hard even to compare one six month period to another, because it can take so many months to work its way through the system.”

Statewide, the former hotbeds of foreclosure sales – Denver and Adams County – have shown dramatic drops in foreclosure sales by public trustee offices, noted McMaken.

The growth is primarily occurring in “mid-sized” markets on the Western Slope and eastern plains, which is the past weren’t the victims of rising foreclosures, he said. In some cases, such as around Grand Junction, the problem is because of a job cuts in the formerly growing and lucrative oil and gas industries, he said. In other places, such as Teller and Park counties, people owned homes based on the “drive to buy” principle, can no longer have the income to pay their mortgages, because they either lost their jobs or are grossly under-employed.

In addition, resort communities in places such as Eagle and Summit counties, are reporting rising foreclosures. McMaken said that figures indicate that many of those are second homes and maybe a third of them are some form of timeshare units.

Ron Woodcock, a broker with RE/MAX Southeast, said the overall Denver single-family housing market is the strongest he has seen since moving here from Florida 3-1/2 years ago. He said some counties in Florida had 30,000 foreclosure filings last year.

“We’re really bucking the national trend,” Woodcock said. “We’re nothing like California, Florida,  Nevada or Arizona.”

Woodcock, however, disagrees with some people who say that if mortgage loans were once again assumable, that would help the foreclosure crisis. “Currently, mortgage rates are lower now than they were two or three years ago,” he said. “Why would you assume a loan of 5.5 percent, when you can get a 4 percent loan today? It might help going forward, but it is not going to help today. And while it is harder to qualify for a loan, really what has happened is that we have returned to what it used to take to qualify for a loan.”

McMaken, of the housing division, said the first wave of foreclosures was due to bad ARMs, interest-only loans, and subprime mortgages. Rising unemployment and falling incomes are responsible for most of today’s foreclosures, he said.

Woodcock said some lenders now would rather work with borrowers on loan modifications, rather than short sales, in which the bank accepts less than the mortgage amount. Still there have only been 1,072 permanent loan modifications in Colorado through 2009. (For more on loan modifications, please go to this blog.)

But Woodcock said that he does worry about the so-called “shadow market.” The shadow market is an unknown number of homes held by the banks, which are not actively being marketed. Nationally, the banks may be holding as many as 7 million properties in this fashion, Woodock said.

“An influx of a lot of those homes would have a negative effect on the market,” Woodcock said. “On the other hand, a lot of investors groups are raising money to buy big portfolios from lenders. They’ll step in and buy 50, 60 or 100 homes at one time. Those type of deals aren’t reported in the MLS, but that type of activity is going on.”

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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Developer Ray Pittman is the new chair of the Aurora Economic Development Council

Ray Pittman, founder and president of Denver-based Pittman Development Group, Inc., a  commercial development and investment company , has been named chair of the board of the Aurora Economic Development Council.

“In his tenure, Ray Pittman has been in the middle of some of Colorado’s most notable and prestigious developments and mixed-use projects,” said Wendy Mitchell, president and CEO of the Aurora Economic Development Council. “Ray’s first-hand development expertise makes him an excellent selection to lead the Aurora Economic Development Council in 2010 as chair of the board.”

He succeeds Jay Gershen, D.D.S., Ph.D., former vice chancellor for external affairs of the University of Colorado Denver and currently president of Northeastern Ohio Universities Colleges of Medicine and Pharmacy, who served as chair for 2009. Pittman will direct the board for a one-year term. This will be Pittman’s ninth year serving on the Aurora Economic Development Council board of directors.

Two dozen years of experience

Pittman’s background includes more than 24 years of experience in commercial real estate brokerage, services, acquisition and development. During this time he has managed some of Colorado’s largest and most prominent commercial and mixed-use projects.

From 2002 through 2006, Pittman was instrumental in creating the vision for High Point, a 1,800-acre mixed-use community near Denver International Airport located in both the city of Aurora and Denver. He oversaw all aspects of the project’s land assemblage, planning, zoning and initial development prior to its sale to LNR Property Corp in 2006.

Most recently, Pittman lead the formation of the new Pittman Pathfinder Colorado Opportunity Fund I, an equity fund targeting the acquisition of distressed real estate assets throughout Colorado. The fund completed its first acquisition of eight distressed residential real estate projects in December of 2009.

Other current projects include: Development of the three-building, 91,000-square-foot High Point OmniCenter project in Denver; acquisition of the two-building Parker Plaza South project; and a long-term development consulting assignment with International Speedway Corp. of Daytona Beach, Fla. to develop a new NASCAR speedway and stadium and related commercial development near Denver International Airport

Prior to founding Pittman Development Group, Pittman served as Colorado’s senior vice president and regional manager for Catellus Development Corp. in Colorado. In this role, Pittman  was responsible for overseeing all aspects of the development business, including acquisitions and dispositions, marketing, sales and leasing, project design, construction management, project financing and community and government relations.

Pittman graduated with high honors from the University of California, Santa Barbara and has completed additional course work in real estate and finance at the University of California, Los Angeles and Stanford University.

A partnership between business and government for more than three decades, the Aurora Economic Development Council champions Colorado’s most promising growth industries including aerospace and defense, bioscience, transportation logistics and energy, positioning Aurora and Colorado to win new jobs in an intensely competitive market.

Job creation name of the game

The council creates new primary jobs through innovative deal creation, strategic partnerships, and by advocating for economically sustainable public policy. A-List, one Colorado’s premier business event, and Accelerate Colorado, the only statewide advocacy group that conducts an annual business mission to Washington, D.C., are produced by the Aurora Economic Development Council for the benefit of the state’s leading industries and Colorado’s economic development.

The Aurora Economic Development Council board of directors consists of CEO-level developers, general contractors, bankers, attorneys, consultants, home builders, engineers, architects and representatives of the aerospace and bioscience industries and educational and hospital institutions. Political leadership from the city of Aurora, Adams County and Arapahoe County also serve on the board. Board membership is limited to 100 leaders that are strategically recruited to mutually benefit the Aurora Economic Development Council and its board members.

The organization’s strategic initiatives for 2010 include objectives in economic development and infrastructure, public policy, and marketing and branding.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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Although the foreclosures last year were the second highest on record – topped only by the 27,122 filings in 2007 in the seven-county area – there were signs of encouragement, as well as a sea change in where the foreclosure activity is gaining speed.

Denver County, for example, which a few years ago was ground-zero for foreclosure activity, showed a slight increase in filings in 2009 from 2008. Foreclosures also fell in 2008 from 2007 in Denver County, when it peaked with 8,240 for filings. Denver was the only county to show a decrease in foreclosures in the fourth quarter from the same period in 2008.

Adams County, with many lower-priced homes, also has been at center-stage for foreclosure activity in recent years, but filing activity was flat in 2009 from 2008, as well as the fourth-quarter of 2009 compared with the last three months of 2008. Overall, foreclosure filings in the fourth quarter from the same period in 2008 were up 32 percent. Some observers  are predicting that another wave of foreclosures could sweep over the Denver area next year.

“Our foreclosure sales are actually down about 20 percent from 2008, and the number of foreclosures being withdrawn are up 17 percent,” said Carol Snyder,  public trustee for Adams County.

“That means more people are staying in their homes and not losing them in foreclosures,” Snyder said. “I think that is a more important than the number of filings.”

She said banks appear much more willing to work with homeowners than they have been in the past.

“I think the banks are learning that it is better to modify loans and keep people in their houses than to add more real estate foreclosures to their portfolios,” Snyder said.

Shannon Peer, director of Housing Counseling, agreed, but is still worried that the state may face more foreclosure filings, which could swamp the state and the system.

He said that the Colorado Foreclosure Hotline (877-601-4673), which Brothers manages, has helped a lot of people learn their options, helping to keep many people out of foreclosure and in their homes.

“But there are indications that a second wave of foreclosure filings building,” Peer said, because of the economy. In addition, another round of  option-ARMs are set to adjust upward in the second half of the year, which could be a calamity for homeowners barley hanging on with their current payments, he said.

He said a “second or third-wave of foreclosure filings,” could offset the drop in foreclosure sales, as well as drop the increase in foreclosure cures and withdrawals.

Meanwhile,  Boulder, Broomfield and Douglas counties have experienced the largest percentage increases in foreclosures, although their overall numbers are still smaller than in Denver, Adams and Arapahoe counties.

“This is the highest number we have ever done. Ever,” said Dianne Bailey, public trustee for Douglas County, where the 2,765 filings in 2009 were almost 27 percent higher than in 2008. Boulder foreclosures rose by more than 38 percent, the biggest increase of the seven area counties.

Bailey was surprised in the surge of foreclosures filings.

“I thought they were going to level off after 2008,” she said. “I guess we thought they just couldn’t go any higher.”

More expensive homes entering the foreclosure process is a trend that counselors saw emerge last year, said  Peer, of  Brothers Redevelopment in Edgewater.

“Over the last year, we have been seeing more homeowners who had higher incomes that we had seen previously,” Peer said. “We’re seeing more home values above $250,000 we had seen in the past. In the past, the under $200,000 price range had been the hard-hit market.  We have seen homes in Evergreen in the $800,000 and $900,000 range, we have seen homes down south in the $600,000 to $650,000 price range. I would say this is a trend that started a good eight months ago. ”

He said it was possible that owners of expensive homes were able to hold out longer than people at the lower-wrung of the economy, but now they, too, are losing their jobs.

One of the challenges they face is that because much of the jumbo-loan money has dried up, it is difficult to find buyers for homes that have mortgages larger than conventional limits of $417,000.

“They are being pinched,” Peer said. “Their are very buyers out there unless they can pay cash. And there aren’t many cash buyers.”

Bobby Burnett, principal of Keller Williams Realty DTC, said that while his regular home sales business was way down last year, his short-sale business was up 50 percent to 60 percent from 2008. A short sale is when a lender takes less than the mortgage amount.

Although the prices were “all across the board,” the biggest increase of distressed properties was for ultra-expensive homes.

“We saw them in Parker, Castle Rocky, a bunch in Boulder,” Burnett said. “The only place that seemed semi-insulated  was Castle Pines Village. I find properties are still selling there.”

Many of the expensive homes are selling for huge discounts, he said.

He tried to sell one home west of Sedalia for $1.1 million, which previously had sold for $1.4 million. Later, the home went into foreclosure and another broker sold it for $750,000.

Perhaps one of the biggest bargains is a 9,000-square-foot home on 11 acres in Elbert County that was appraised at $3 million three years ago.  It’s likely now to sell in a short sale for about $800,000, he said.

“The house looks like a southern mansion in Atlanta,” Burnett said.

Denver City Councilman Rick Garcia, who a couple of years created a Foreclosure Task Force, said that he is not surprised that foreclosure activity is rising faster in the suburbs than in the city.

“As I recall a couple of years ago from data from the Foreclosure Task Force, the average price of a home in foreclosure in Denver was around $124,000, far below the median-price of a home in the city,” Garcia said.

Many of those homes, he said, have been purchased with the help of federal funds or have been “gobbled up” by private investors. They have since been “rehabilitated” and put back into the market, he said.

The first round of foreclosures came from “unscrupulous lenders,” who saddled buyers with high-mortgage rates, Garcia said. Many of those homes in Denver have since worked their way through the system, Garcia said.

He said he thinks many more of those kind of loan, as well as no downpayment loans that were not supported by incomes, were made in suburban subdivisions.

“Denver seems to be bottoming out of the foreclosure circumstances,” Garcia said. “Now, I would say we are seeing more of what I would call “traditional” foreclosures, caused by people losing their jobs.”

Ryan McMaken, spokesman for the Colorado Division of Housing, said that the Denver-area data seems to confirm that more expensive homes in suburban areas are now suffering from growing foreclosures.

“Overall, what I would say is that the Denver-area is fairly flat, while foreclosures are rising elsewhere in Colorado,” McMaken said.

Later this months, McMaken will release a report that will show a record number of foreclosure filings in the state. In 2008, there were just under 40,000 foreclosure filings in all of Colorado, but his data will show more than 45,000 filings in 2009.

There are still a few counties to report to the division, but he expects about 47,000 filings when he receives all of the data. “I’m already at something like 45,400,” he said.

He noted that when the foreclosure crisis began several years ago, “the Denver-area was driving it,” and much of the area outside of the metro area remained impervious.

That is no longer true, as more populous areas along the eastern plains, as well as a number of Western slope communities, are seeing huge percentage increases in foreclosures.

“Of course, there are other economic factors driving the foreclosures in a lot of mid-sized counties outside of the Denver metro area,” he said. For example, a downturn in mining and exploration is hurting the Grand Junction area, while the failure of Greeley-based New Frontier Bank hurt ranchers and farmer.

Sources: Public Trustees

*Adams County removed “repeat” filings, which reduced the total amount by about 100 each year.

Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865.

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In the seven-county area, there were 7,109 foreclosure filings in the third quarter, compared with 4,365 in the third quarter 2008. The biggest jump in each county – Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas and Jefferson – occurred in August compared with August 2008.

However, the jump in foreclosures was expected to some extent, because of a new state law that went into effect in August 2008. The law, HB 1402, requires lenders to send out letter to delinquent borrowers 30 days before foreclosure filings. That led to August 2008 foreclosure filings to be abnormally low. Overall, August filings were up 165 percent from August 2008.

‘It would seem that for year-over-year comparisons, the implementation of HB 1402 last year is certainly the most important factor in making that comparison,” said Ryan McMaken, spokesman for the Colorado Division of Housing.

“The September numbers from 2008 are also exceptionally low, and this seems to be related to the drop in totals brought on by 1402 as well,” he added. ” Looking at the numbers from earlier in 2008, monthly totals were up around 400 to even 600. They only really climbed to that level again in April of this year, and numbers have remained solidly high this year. So while the drop in August and September of last year does show an extremely large increase year-over-year, the numbers for July, August, and September of this year appear to be near the highest rates we’ve seen in the last couple of years.”

McMaken also noted that in the Denver metro area last year, the increase from September to October was more than 50% from 1,623 to 2,520. And in both 2007 and 2008, the fourth quarter experienced larger filings totals than the third quarter.

” Both facts lead us to not expect the fourth quarter to register significant drops in totals as compared to the third quarter,” he said

However, there also were jumps in September filings from a year earlier, although not as great as in August from August.

“I don’t think we will see any big decrease of any kind from here on out to the end of the year,” McMaken said.

In the first nine months of the year, there were 20,260 filings, a 5.4 percent increase from the 19,226 filings in the first nine months of 2008.

“I’m not surprised with the 5 percent increase,” McMaken said.

He noted that foreclosures also were expected to rise because lenders had declared voluntary moratoriums on pursuing last fall, which ended in the spring. Many lenders used that time to beef-up their departments to work with homeowners delinquent on their mortgage payments, he said.

And that segues into the bright spot in the foreclosure numbers.

“Lenders appear much more willing to work with borrowers on things like loan modifications more than they did in the past,” said Carol Snyder, public trustee for Adams County.

In the third quarter of this year, 746 homes went to the public trustee auctions, a 32.9 drop from the 1,113 foreclosure sales in the third-quarter of 2008.

“To me, that indicates that lenders are working with borrowers to let them modify their loans or refinance,”  she said.

“That is certainly what I am hearing and what foreclosure counselors are hearing,” McMaken said.

Some distressed borrowers, for example, are being offered 4 percent mortgages that are amortized over 40 years, allowing owners who were behind on their mortgages able to stay in their homes.

Tom Cryer, a broker with the Kentwood Co., last week said that lenders also may be reluctant to take possession of homes and put them on the market. He said that lenders may be hoping that the Obama administration will buy the homes or the delinquent loans from them at a better price than they they would flood the market with foreclosed homes.

“A lot of brokers walk around neighborhoods and we see vacant homes, which clearly are foreclosures,” Cryer said. “But these homes are not reflected in our numbers. If they were, the number of unsold homes on the market would be much higher.”

McMaken noted that the Treasury Department has bought up so many toxic loans that it has kept mortgage rates low, providing some relief to the housing market.

He said there are few signs that a a huge increase in demand is brewing that would allow the market to bail out the depressed housing market in the Denver area or across the nation.

And with unemployment growing and a wave of mortgage rates adjusting higher, many economists and observers expect another wave of foreclosures.

County	July 2008	July 2009	August 2008	August 2009	September 2008	September 2009
Adams	511	490	266	537	328	429
Arapahoe	454	590	167	554	348	555
Boulder	108	245	46	132	47	170
Broomfield	25	34	9	27	24	19
Denver	470	634	148	550	361	453
Douglas	176	222	111	284	53	234
Jefferson	352	390	151	301	210	359
Total	2,096	2,505	898	2,385	1,371	2,219
Percentage Change		19.5%		165%		61.8%

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Contact John Rebchook at JRCHOOK@gmail.com or 303-945-6865

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