This post just in from the Virginia Association of REALTORS, Submitted by Andrew Kantor on May 11, 2012 – 8:32am
We’ve now got MRIS’s April numbers for foreclosures and short sales. Short sales are slightly up, but foreclosures are waaaay down.
Short sales: 12.2% of the market, up about 3% from last April
Foreclosure sales: 11.0% of the market, down 47% from last April
Total distressed sales: 23.2% of the market, down 29% from last April
Granted, having a market where almost a quarter of the sales are distressed isn’t a Good Thing, but there’s a sense to it. People bought near the top of the bubble and have to sell (for whatever reason — job, life change, etc.). So they either take the hit or work out a short sale with their lenders.
That means that short sales are going to continue to be a noticeable part of the market for as long as lots of folks own homes bought between, say, 2004 and 2007. If they have to sell, they’ll have to sell at a lower price, ’cause it’s gonna be a while before prices are back up to those unnatural highs.
Comments from Vicky Chrisner: This is great news and evidence of the continuing market recovery. From a personal standpoint, within my service areas I am seeing 20% or less of the market is distress sales (foreclosures+short sales). In 2008, I mostly worked REOs (foreclosures); in 2009 it was a mix of REOs and short sales; in 2011 my business was about 1/3 traditional resales, 1/3 distress sales and 1/3 new construction. So far, in 2012, I have worked mostly with traditional resales and new construction and am pleased to report that I am even doing a lot of land sales again…. I estimate the percentage of distress sales is about 15-20% of my business so far; which seems very much in line with the submarkets where I work.
-Footnote: The chart included in this post is from 2011, and shows most of the DC Metro area as “Yellow” meaning 21-30% of homeowners were “underwater”. This percentage is probably down somewhat now, but is roughly in line with the MRIS numbers, and my own observations of the market place.
-Footnote: MRIS is the Metropolitan Regional Information System~ It is the multiple listing service for the Washington DC Metro area which includes Northern Virginia, Washington DC and most of Maryland.