Daly City hit hard by housing crisis
By: Katie Worth
Examiner Staff Writer
January 8, 2009
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| Juan Carlos Pometta Betancourt/Special to The Examiner Common sight: For-sale signs have been popping up frequently in Daly City, with about 330 foreclosures in its quadrant — which includes smaller cities Pacifica and San Bruno — recorded in the past few months. |
DALY CITY — Daly City has taken a big hit during the nation’s housing crisis.
Though no local, state or federal agency collects or organizes information about where or why the foreclosures are happening — a reality that has infuriated and stymied city officials — private online database RealtyTrak indicates Daly City has had hundreds more foreclosures than any other city in the county. The only city in the county that eclipses Daly City in its per capita foreclosures is the much smaller East Palo Alto in the southeastern corner of the county.
Daly City officials believe families in every neighborhood have been displaced.
To attempt to get some handle on how the housing crisis is playing out, the San Mateo County Association of Realtors recently started compiling data on foreclosed homes. Their numbers mirror those available in the online databases: The northwestern quadrant of the county — which includes Daly City and neighbors Pacifica and San Bruno — has outpaced every other quadrant, said Sue Walsh, the organization’s president.
She said there have been about 330 foreclosures in Daly City’s quadrant since the association began tracking data a few months ago, compared with about 240 in the southeast, which includes East Palo Alto, Redwood City and Menlo Park. The other quadrants have had significantly fewer foreclosures, she said.
Though it’s clear Daly City has been hit hard with foreclosures, what’s less conclusive is precisely why the relatively affluent county’s largest city has become such a focal point for the crisis.
Rich Berger, Daly City’s director of Economic and Community Development, said it’s hard to address the problem because it’s almost impossible to get accurate data about who is being impacted.
“Our housing staff has been trying to get a handle on accurate data about what’s going on, where these foreclosures are, what point in the process they are, whether it’s families or investors who are losing these homes,” Berger said.
Some 53 percent of Daly City’s population is foreign-born, and the city’s median income is significantly lower than the county average, he said. But exactly how these facts play into the crisis — and what to do about it — has been difficult to determine without better information on who’s being impacted and why they can’t make their payments.
“Not all foreclosures are created equal, and without the data, we can make educated guesses, but that’s it,” Berger said.
Robert Jones, executive director of the nonprofit East Palo Alto Community Alliance and Development Organization, or EPA Can Do, said the majority of Daly City residents looking for help from his organization are people who invested everything they had into buying a home, but that hasn’t proved to be enough.
“A good number have gotten loans that they never should have, and they can’t make the
payments anymore,” he said.
He said new homes in Daly City were somewhat cheaper than elsewhere in the county.
“New homes were going up in Daly City at an alarming clip, and people wanted to take advantage of it and not get priced out of the market,” he said. It’s clear that some of the city’s non-English-speaking populations were targeted by predatory lenders, Jones said.
“A lot of people just didn’t understand the product they were getting,” he said. “There was a lot of greed going on with mortgage brokers — people trying to capitalize on people’s motivation to purchase a home regardless of their ability to pay, on people wanting a piece of the American dream.”
County rolls out welcome mat, but federal support is absent
Compared with its sister counties to the south and east across San Francisco Bay, relatively affluent San Mateo County has so far escaped the nation’s housing crisis reasonably unscathed.
But its better performance also has consequences.
Much of the federal allocations for relief have been doled out to the nation’s hardest-hit communities, those that have the highest numbers and percentages of foreclosed homes.
But that policy leaves out a county like San Mateo, which has small, dispersed pockets of highly impacted neighborhoods but whose overall numbers don’t look so bad, said Robert Jones, executive director of the East Palo Alto Community Alliance and Development Organization, a nonprofit that provides financial advice to people hit by the housing crisis.
“We have these pockets where people are really hurting,” Jones said, “but it won’t come up on anybody’s radar because we don’t have as much volume as some other places.”
For example, the $4 billion Neighborhood Stabilization program authorized by Congress and President George W. Bush in July provides money to states and certain local communities to purchase, rehabilitate or redevelop foreclosed homes.
A formula designed to consider how hard-hit each community is was responsible for doling out program funding to 33 cities and 13 counties in California, but neither San Mateo County nor any of its cities received funding.
Nonprofits have run into similar walls when looking for money to expand financial education and advice services, Jones said.
“Right now I have four foreclosure counselors, and if I had four more, that still wouldn’t be enough,” he said. “We’re really just scratching the surface.”
But it’s going to be difficult to get that help from the federal government, since on the surface San Mateo County’s numbers simply don’t appear to be as dire as other places.
“Overall, it doesn’t really compare with Stockton or Oakland,” Jones said. “But if you drive through the neighborhoods, you will see we have great needs, too, but they just don’t register.”
Foreclosures have ripple effect on cities
A spate of home foreclosures has myriad effects on a city, said Robert Jones, executive director of nonprofit East Palo Alto Community Alliance and Development Organization, or EPA Can Do.
As dozens or hundreds of families in a community are turned out of their houses — and sometimes even wind up on the street — prices throughout the community also drop. This effectively traps some homeowners where they are, because even if they’ve been making payments regularly, they may owe more than what their house is currently worth and wouldn’t be able to sell it, Jones said.
The foreclosed homes also can cause blight in a neighborhood. Rich Berger, Daly City’s director of Economic and Community Development, said the city has received complaints about homes being broken into, damaged by their former owner or not kept up by the lender who has taken the house back. He said the office is encouraging residents to report such violations so the problem doesn’t cause further affliction in neighborhoods already hit hard by the housing crisis.
Housing crunch
Daly City has hundreds more foreclosures than any other city in San Mateo County. The following chart shows the number of foreclosures, compared with each city’s population.
| City |
Population* |
Foreclosures** |
| Daly City |
100,882 |
771 |
| South San Francisco |
61,870 |
443 |
| Redwood City |
73,603 |
359 |
| San Mateo |
91,768 |
352 |
| East Palo Alto |
33,097 |
287 |
| San Bruno |
40,017 |
263 |
*U.S. Census estimate, July 1, 2007
**Foreclosures listed on RealtyTrak as of Dec. 28
