Despite a sizeable drop in the fourth quarter, sales of foreclosed properties again accounted for over a quarter of all single-family home sales in 2010. Sales of foreclosed homes represented almost 26 percent of all sales during the year, down from 29 percent in 2009. The discount buyers received for these homes was 28 percent off the average sale price of a non-foreclosed property compared to a 27 percent discount in 2009.
The RealtyTrac Year and Q4 2010 U.S. Foreclosure Sales ReportTM released on Thursday states that a total of 831,574 residential properties that had either been foreclosed or were in some stage of foreclosure were sold to third parties during the year. This was a 31 percent drop in these sales from the 2009 level, but was a larger market share as the volume of non-foreclosed property sales dropped 19 percent from 2009 figures.
During the fourth quarter, sales of foreclosed homes dropped 22 percent and were down 45 percent from a year earlier however they reflected the lower sales figures for all homes during the period and still accounted for 26 percent of total sales. The average discount was 28 percent, identical to the year-long average.
Here is where the asterisks come into play...
"Foreclosure sales in the fourth quarter faced the twin headwinds of the expired homebuyer tax credit - which began to stifle sales volume during the third quarter - and the foreclosure documentation controversy, which hit in the fourth quarter and temporarily froze sales of foreclosures from several major lenders," said James J. Saccacio, chief executive officer of RealtyTrac.
"Given those factors, it's not surprising that in the fourth quarter foreclosure sales volume hit its lowest level since the first quarter of 2008. Still, foreclosures continue to represent a substantial percentage of all U.S. residential sales and continue to sell at an average sales price that is significantly below the average sales price of properties not in foreclosure - the result of a bloated supply of foreclosures and weak demand from homebuyers." Saccacio continued, "The catch-22 for 2011 is that while accelerating foreclosure sales will help clear the oversupply of distressed properties and return balance to the market in the long run, in the short term a high percentage of foreclosure sales will continue to weigh down home prices."
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Source: http://www.mortgagenewsdaily.com/02242011_foreclosures.asp
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