Foreclosure Home Housing & Foreclosure Reports Foreclosure Sales Account for 31 Percent of All Residential Sales in First Quarter According to New Report From RealtyTrac

Foreclosure Sales Account for 31 Percent of All Residential Sales in First Quarter According to New Report From RealtyTrac

Print Email
Comments Add Comment

Nearly 233,000 Foreclosure and Bank-Owned Homes Sold
at an Average Discount of 27 Percent

IRVINE, Calif. – June 30, 2010 — RealtyTrac® (http://www.realtytrac.com/gateway_co.asp?accnt=137300), the leading online marketplace for foreclosure properties, today released its first U.S. Foreclosure Sales Report™, which shows that foreclosure homes accounted for 31 percent of all residential sales in the first quarter of 2010, and that the average sales price of properties that sold while in some stage of foreclosure was nearly 27 percent below the average sales price of properties not in the foreclosure process.

A total of 232,959 U.S. properties in some stage of foreclosure — default, scheduled for auction or bank-owned (REO) — sold to third parties in the first quarter, a decrease of 14 percent from the previous quarter and down 33 percent from the peak during the first quarter of 2009, when sales of foreclosure homes accounted for 37 percent of all residential sales.

“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.”

The average sales prices on properties in some stage of foreclosure decreased 23 percent from 2006 to 2009 while the average discounts on foreclosure purchases steadily increased from 21 percent in 2006 to 27 percent in the first quarter of 2010. Discounts on REOs are larger than discounts on pre-foreclosures, although discounts on pre-foreclosures appear to be trending higher as short sales become more common.

Foreclosure sales increase 2,500 percent from 2005 to 2009
More than 1.2 million U.S. properties in some stage of foreclosure sold to third parties in 2009, an increase of 25 percent from 2008 and an increase of nearly 327 percent from 2007. Total foreclosure sales in 2009 were up more than 1,100 percent from 2006 and up more than 2,500 percent from 2005. Foreclosure sales accounted for 29 percent of all sales in 2009, up from 23 percent in 2008 and up from 6 percent in 2007.

The average sales price of properties that sold while in some stage of foreclosure in 2009 was 25 percent below the average sales price of properties not in the foreclosure process. That was up from an average discount of 22 percent in 2008 but down from an average discount of 26 percent in 2007. The average foreclosure discount in 2005 was 35 percent, driven by a nearly 50 percent discount on REOs; however, the discount on pre-foreclosures trended up slightly over the same five-year period, from nearly 12 percent in 2005 to 15 percent in 2008 and 2009.

Foreclosure sales by type in first quarter
A total of 144,503 bank-owned (REO) properties sold to third parties in the first quarter, down 13 percent from the previous quarter and down 27 percent from 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.

A total of 88,456 pre-foreclosure properties — in default or scheduled for auction — sold to third parties in the first quarter, down 15 percent from the previous quarter and down nearly 41 percent from the first quarter of 2009. Pre-foreclosure sales accounted for nearly 12 percent of all sales, up from nearly 10 percent in the previous quarter but down from 16 percent in the first quarter of 2009. Pre-foreclosures, which are often short sales, sold for an average discount of nearly 15 percent, up from nearly 14 percent in the previous quarter but down from 16 percent in the first quarter of 2009.

Nevada, California, Arizona post highest percentage of foreclosure sales in Q1
Foreclosure sales accounted for 64 percent of all sales in Nevada in the first quarter, the highest percentage of any state, although Nevada’s percentage was down from 65 percent of all sales in the previous quarter and 75 percent of all sales in the first quarter of 2009.

California posted the second highest percentage, with foreclosure sales accounting for 51 percent of all sales there in the first quarter — up slightly from 50 percent in the previous quarter but down from 70 percent of all sales in the first quarter of 2009.

Foreclosure sales as a percentage of all sales were also down in Arizona from the first quarter of 2009, but the state still posted the third highest percentage in the first quarter, with foreclosure sales accounting for 50 percent of all sales.

Other states where foreclosure sales accounted for at least one-third of all sales were Massachusetts, Rhode Island, Florida, Michigan, Georgia, Illinois, Idaho and Oregon.

Ohio, Kentucky, Illinois post highest foreclosure discounts
The average sales price of properties that sold while in some stage of foreclosure in the first quarter was 39 percent below the average sales price of properties not in the foreclosure process in Ohio, Kentucky and Illinois — the states with the three highest average foreclosure discounts.

The average overall foreclosure discount was at least 35 percent in California, Tennessee, Pennsylvania, DC and New Jersey.

The biggest discount on bank-owned properties was in New York, where the average sales price for REOs was 52 percent below the average sales price for properties not in foreclosure. The biggest discount on pre-foreclosure properties was in Rhode Island, where the average sales price for properties in default or scheduled for auction was 33 percent below the average sales price for properties not in foreclosure.

Report methodology
The RealtyTrac U.S. Foreclosure Sales Report is produced by matching national address-level sales deed data against RealtyTrac’s foreclosure database of pre-foreclosure (NOD, LIS), auction (NTS, NFS) and bank-owned (REO) properties. A property is considered a foreclosure sale if a sales deed is recorded for the property while it was actively in some stage of foreclosure or bank-owned. The foreclosure discount is calculated by comparing the percentage difference between the average sales price of properties not in foreclosure to the average sales price of properties in some stage of foreclosure or bank-owned. States without sufficient foreclosure sales data to calculate average prices are not included in the report.

Glossary of Terms
Foreclosure (FC) sale: a sale of a property that occurs while the property is actively in some stage of foreclosure (NOD, LIS, NTS, NFS or REO). This includes only sales to third-party buyers or investors not involved in the foreclosure process. It does not include property transfers from the owner in default to the foreclosing bank or lender.

REO sale: a sale of a property that occurs while the property is actively bank owned (REO).

Pre-foreclosure sale: a sale of a property that occurs while the property is actively in default (NOD, LIS) or scheduled for foreclosure auction (NTS, NFS).

Pct. of all sales: total number of Foreclosure Sales (or Pre-Foreclosure Sales or REO Sales) as a percentage of all residential sales during the quarter or year.

Avg. FC sales price: the average sales price of Foreclosure Sales (or Pre-Foreclosure Sales or REO Sales) during the quarter or year, excluding sales with no sales price.

Avg. FC discount: the percentage difference between the average sales price of foreclosure sales and the average sales price of non-foreclosure sales during the quarter or year.

Avg. REO discount: the percentage difference between the average sales price of REO sales and the average sales price of non-foreclosure sales during the quarter or year.

Avg. pre-foreclosure discount: the percentage difference between the average sales price of pre-foreclosure sales and the average sales price of non-foreclosure sales during the quarter or year.

 

Q1 2010 Top 5 States: Foreclosure Sales Percentage of All Sales

  Total Foreclosure (FC) Sales    
State Name # of FC Sales % Chg from Q4 09 % Chg from Q1 09 Pct. of All Sales Avg. FC Sales Price Avg. FC Discount Avg. REO Discount Avg. Pre-FC Discount

U.S.

232,959 -14.04 -33.18 31.04%  $ 171,971 26.70% 34.04% 14.77%
Nevada
10,425
-25.40
-45.23
63.50%
$136,176
16.93%
19.53%
10.78%
California
59,823
-21.33
-46.73
50.82%
$246,272
37.83%
43.86%
28.30%
Arizona
17,307
-16.52
-33.30
50.29%
$138,021
24.82%
29.48%
18.10%
Massachusetts
2,111
1.69
-53.55
42.15%
$161,089
33.41%
36.07%
32.39%
Rhode Island
623
20.04
-43.00
41.64%
$120,647
30.46%
14.78%
32.75%

 

 

Q1 2010 Top 5 States: Average Foreclosure Discount

  Total Foreclosure (FC) Sales    
State Name # of FC Sales % Chg from Q4 09 % Chg from Q1 09 Pct. of All Sales Avg. FC Sales Price Avg. FC Discount Avg. REO Discount Avg. Pre-FC Discount

U.S.

232,959 -14.04 -33.18 31.04%  $ 171,971 26.70% 34.04% 14.77%
Ohio
7,393
-5.93
-53.74
28.94%
$79,762
39.47%
44.56%
21.14%
Kentucky
1,028
6.20
19.12
18.88%
$94,651
39.17%
45.88%
26.47%
Illinois
8,403
-11.12
-5.79
33.94%
$133,590
39.11%
45.88%
19.32%
California
59,823
-21.33
-46.73
50.82%
$246,272
37.83%
43.86%
28.30%
Tennessee
4,502
-13.77
-29.63
22.77%
$94,381
37.42%
39.29%
21.63%

 

About RealtyTrac Inc.
RealtyTrac (http://www.realtytrac.com/) is the leading online marketplace of foreclosure properties, with more than 1.5 million default, auction and bank-owned listings from over 2,200 U.S. counties, along with detailed property, loan and home sales data. Hosting more than 3 million unique monthly visitors, RealtyTrac provides innovative technology solutions and practical education resources to facilitate buying, selling and investing in real estate. RealtyTrac’s foreclosure data has also been used by the Federal Reserve, FBI, U.S. Senate Joint Economic Committee and Banking Committee, U.S. Treasury Department, and numerous state housing and banking departments to help evaluate foreclosure trends and address policy issues related to foreclosures.

###

Media Contact:
Michelle Sabolich
Atomic Public Relations
415. 593.1400, ext. 233
michelle.sabolich@atomicpr.com

Order Custom Data:
Data Sales Department
800.913.0439
datasales@realtytrac.com


Print Email < Back to Housing & Foreclosure Reports
Printed from www.RealtyTrac.com

Comments

Add Your Comment

You must be logged in to leave a comment. Login | Register

Submit


Search Foreclosure Reports