Both home buyers and agents have come to rely on RealtyTrac® as a great resource for tracking foreclosures in our area. Their new study shows that sales of foreclosure properties accounted for 31 percent of all residential sales nationwide in the first quarter. The report also showed that the average sales price of properties that sold while in the foreclosure process was nearly 27 percent less than the average sales price of properties not in the foreclosure process.
Nationally, a total of 144,503 bank-owned (REO) properties were sold to third parties in the first quarter, a decrease of 13 percent from the previous quarter and down 27 percent compared with the first quarter of 2009. REO sales accounted for 19 percent of all sales in the first quarter, up from nearly 16 percent in the previous quarter, but down from 21 percent of all sales in the first quarter of 2009. REOs sold for an average discount of 34 percent, up from an average discount of nearly 32 percent in both the previous quarter and the first quarter of 2009.
Our local story is more grim. Foreclosure sales accounted for 51 percent of all sales in California in the first quarter, up slightly from 50 percent in the fourth quarter, but down from 70 percent of all sales in the first quarter of 2009, according to the report. These statistics rank California #2 in the top 5 foreclosure heavy states, following Nevada at 64% and just edging out Arizona at 50%. (See chart below.)
“First time homebuyers and investors continue to buy foreclosure properties in large numbers, and at substantial discounts,” said James J. Saccacio, chief executive officer of RealtyTrac. “As lenders have begun repossessing homes at record levels over the first half of 2010, it will be interesting to watch how they will manage the inventory levels of distressed properties on the market in order to prevent more dramatic price deterioration.”