in News > Mortgage Servicing
print the content item
Foreclosure homes accounted for 31% of all residential sales in the first quarter of this year, and the average price discount for properties that sold while in some stage of foreclosure was nearly a 27% discount, according to RealtyTrac's first U.S. Foreclosure Sales Report.

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% from the previous quarter and down 33% from the peak during the first quarter of 2009, when sales of foreclosure homes accounted for 37% of all residential sales.

“First-time home buyers and investors continue to buy foreclosure properties in large numbers, and at substantial discounts,” says James J. Saccacio, CEO 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% from 2006 to 2009, while the average discounts on foreclosure purchases steadily increased from 21% in 2006 to 27% 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.

A total of 144,503 REO properties sold to third parties in the first quarter - down 13% from the previous quarter and down 27% from the first quarter of 2009. REOs sold for an average discount of 34%.

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

Nevada, California and Arizona posted the highest percentage of foreclosure sales in the first quarter, at 64%, 51% and 50%, respectively. 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.

The average sales price of properties that sold while in some stage of foreclosure in the first quarter was 39% 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% in California, Tennessee, Pennsylvania, the District of Columbia and New Jersey. The biggest discount on REOs was in New York, where the average sales price for REOs was 52% 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% below the average sales price for properties not in foreclosure.

SOURCE: RealtyTrac


First American_id1388


Latest Top Stories

FHFA Clarifies Rep And Warranty Framework

"We know that the [existing] Representation and Warranty Framework did not provide enough clarity to enable lenders to understand when Fannie Mae or Freddie Mac would exercise their remedy to require repurchase of a loan," said Mel Watt, director of the FHFA.


Mounting Indicators Prove Housing 'Recovery' Illusory

While there are some signs that things are improving, in reality there are mounting indicators that another housing downturn is near.


Wingspan Lays Off Employees At Two Call Centers

"It is in the nature of our work with large financial institutions to wrap up specific contracts for services and to have brief periods of time before new contracts begin," Wingspan officials said in a statement.


IDS Reports Spike In HELOC Volume In 2014

The firm is forecasting that if volumes stay at current levels, HELOC loan doc draws this year could exceed those of 2013 by nearly 65%.


CFPB Fines Flagstar Bank $37.5 Million For Mortgage Servicing Violations

In a statement, Richard Cordray, director of the CFPB, says the action taken against Flagstar "signals a new era of enforcement to protect consumers against the cost of servicer runarounds."

Urban Lending_id1351
Hse SandyHook
Industry Resource
Play for Pink
MBATX_id1385
SWBC_id1313
BSI_id1381
Safeguard_id1322