Lenders have been repossessing homes at record levels in the first half of 2010 according to RealtyTrac. Let’s hope banks are focused on regulating these properties to protect market values from deteriorating even further!
Here in North Carolina, REO sales accounted for almost 15% of all sales so far this year with an average discount of about 25% off market value.
Nationally, REO sales represent 31% of all home sales! Short sales accounted for about another 12%. Those two categories together account for almost half of all homes sold nationally!
What does this mean to the average homeowner trying to sell their property today? Well, there are a lot of cheap properties for sale and you’ll probably have to take less than you feel your home is worth to get it sold. If you have to move now, you may want to consider renting out your property until the market changes so you won’t have to take a significant loss with today’s competitive pricing market. I know people worry about renters messing up the property, but if you’re looking at a potential increase of $30,000 to $40,000 in the next few years, that additional income to you would buy a lot of paint and carpet!
Nationally, the average REO discount is reported to be about 34% while the average work out or short sale discount is about 15%. According to these numbers, as a seller you may want to get a discount to be able to sell your property but, as a buyer you may get a better price if you can buy the property after it has foreclosed.
RealtyTrac also announced that foreclosures were up 2500% from 2005 to 2009! Nevada, California and Arizona continue to post the highest percentage of foreclosure sales. Interestingly, Ohio, Kentucky and Illinois post the highest percentage of foreclosure discount.
Is your house in the foreclosure process? What are you doing about it? Have you decided to let it proceed? Are you trying a workout? Are you thinking about walking away?
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