Home prices across the U.S. are rising in most areas and after six years of actual doom and real gloom it's possible to suggest that the housing market has begun to look up.
The latest report from the National Association of Realtors says existing home prices were 9.5% higher in August when compared with a year earlier. That's an impressive figure when you consider that major markets continue to be impacted by distressed homes and that additional foreclosures — short sales and REOs — are coming onto the market at discounted prices everyday.
Other impressive figures come from Coldwell Banker. It says business is booming in five ZIP codes where home sales are above the $10 million mark. In the one-year period ending in June such sales included 21 properties in Beverly Hills (90210), 12 estates in Santa Barbara (93108), 10 mansions in Bel Air (90077), nine properties in Aspen (81611) and seven homes in Miami Beach (33139).
Foreclosures, Short Sales & REOs
What's interesting about our super-wealthy enclaves is that they contain more than mansions and the well-heeled. According to RealtyTrac, each of the leading super-house areas also includes distressed properties.
"You can find distressed housing even in wealthy areas," said RealtyTrac Vice President Daren Blomquist. "People in every income bracket have been impacted by the foreclosure crisis and even enormously-expensive homes are sometimes available at a relative discount."
Foreclosure filings vary according to the process used in the local jurisdiction. In some cases you can see a Notice of Default (NOD), a Lis Penden (LIS), a Notice of Trustee sale (NTS) or a Notice (Judgment) of Foreclosure Sale (NFS). Because of the time it takes in some areas to foreclose individual properties can receive multiple notices.
Short sales are often seen as pre-foreclosures, however some short sellers are current on their loans and not actually in foreclosure. Instead, their homes are financially underwater and they want to sell for less than the value of the mortgage. Such sales require lender approval.
Homes which go through the foreclosure process but are not sold at auction become REOs -- real estate owned by the lender.
"Foreclosure sales are increasing from a year ago in the California ZIP codes, but foreclosure sales were down during the same period in the Miami and Aspen ZIP codes," said Blomquist. However, he explained that foreclosure activity -- notices and such -- are up in the Miami ZIP code from a year ago but down in the other high-income centers.
It's strange to think of discounted homes in areas of great wealth but such properties are plainly there. And, there can still be significant discounts derived from properties facing foreclosure -- even those in wealthy neighborhoods.