Corelogic is reporting that distressed sales accounted for 10% of homes sold nationally in March AND they expected them to return to Pre-Crisis Share in 2018. Distressed sales, which include REO & short sales, accounted for 9.9% of total U.S. home sales in March ’16, down 2.7 percentage points from March ’15 and down 1.7 percentage points from February ’16.
Key takeaways:
- Of total sales in March 2016, distressed sales accounted for 9.9% and real estate-owned (REO) sales accounted for 6.8%
- The REO sales share was 21.1 percentage points below its peak of 27.9% in January 2009
- Distressed sales shares fell in most states, including the oil markets
“While distressed sales play an important role in clearing the housing market of foreclosed properties, they sell at a discount to non-distressed sales, and when the share of distressed sales is high, it can pull down the prices of non-distressed sales. There will always be some level of distress in the housing market, and by comparison, the pre-crisis share of distressed sales was traditionally about 2 percent. If the current year-over-year decrease in the distressed sales share continues, it will reach that “normal” 2-percent mark in mid-2018.”
