'Distressed' home sales near '09 peak
Riverside, Calif., and Las Vegas see the most sales of foreclosed homes or homes sold short. The trend could add pressure to home prices.
First American CoreLogic, a subsidiary of title-insurance company First American (FAF), said distressed sales accounted for 29% of all sales in January.
Distressed transactions have a strong negative influence on home prices, according to First American.
The lows in prices for 2009 coincided with a peak in bank-owned property sales. Distressed sales include short sales, in which lenders allow a home to sell for less than the outstanding debt.
The trend is worrisome to economists who have warned that federal home loan modification efforts and foreclosure moratoriums would result in a backlog of homes hitting the market, forcing prices lower and hurting the economy.
This "shadow supply" late in 2009 was estimated at 7 million units by Amherst Securities Group.
Riverside, Calif., and Las Vegas had the largest percentage of distressed sales in January at 62% and 59% of total sales in those markets, respectively, the report said.
California, Nevada and Florida had the biggest shares of distressed sales.
There's a big gap between sale prices for properties sold without any loan problems and distressed sales, First American said.
The average non‐distressed market‐sale price in January was $247,700, but the distressed average price was $161,600. The average REO price was $141,900, compared to $215,300 for short sales.
The discount between market sales and distressed sales is currently about one‐third and has been running at the low‐to‐mid 30% range in the last 12 months, First American said.
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
[BRIEFING.COM] Stocks entered the weekend on a mixed note as the S&P 500 shed 0.1% while the Dow ended with a gain of 0.1%.
The major averages began the day on a lower note as nine of ten sectors saw losses of more than 0.5%.
The consumer staples sector was the lone exception as the group spent the entire day in positive territory thanks to the relative strength of Dow component Procter & Gamble (PG 81.89, +3.19). The second-largest staple stock advanced ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
Try as the bears might, they couldn't break US stocks. But investors still face frothy prices and considerable headwinds.