Sales of distressed properties declined in the first quarter of the year, but they

still accounted for 28 percent of all home sales. This is six times the rate it

would be in a normal housing market.

Statistics

According to RealtyTrac, Inc., foreclosure sales hit the highest share of overall

sales in one year during the first quarter. “It’s an astronomically high number,”

said Rick Sharga, a senior vice president at RealtyTrac. “In a normal market,

you’re looking at the percentage of homes sold in foreclosure to be below 5

percent.” Bank and court delays have slowed the rate at which homes enter the

foreclosure market as of late, however, distressed properties are still a large

portion of the housing market.

Foreclosures peaked two years ago at 37.4 percent. According to RealtyTrac, In

the first quarter of 2011, they rose from 27 percent in the prior quarter, but fell

from 29 percent a year earlier, according to RealtyTrac.

Overall, 158,434 homes in some stage of foreclosure were sold in the first

quarter. This was a decrease of 16 percent from the last quarter of 2010 and

down 36 percent from a year ago. Notably, normal home sales also decreased

drastically. While the number of bank-owned properties sold declined, they

grew as a portion of all home sales. Bank-owned homes accounted for nearly 19

percent of all sales, up from 17 percent in the fourth quarter and up from 18

percent a year ago, the firm said. This is bad news for the housing market.

RealtyTrac estimates there are 872,000 homes that have been repossessed by

lenders, but haven’t been sold yet. At the rate in the first quarter, it will take

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three years to clear the inventory of 1.9 million properties already in some stage

of foreclosure.

Prices

Home buyers who bought a bank-owned home in the first quarter saved on

average 35 percent as opposed to the average price of other types of homes.

This is the same as the previous quarter but an increase from an average of 33

percent a year ago.

Buyers purchased other homes in foreclosure (including short sales) got an

average discount of 9 percent, according to RealtyTrac. This is a decrease from

an average of 13 percent in the fourth quarter and an average of 14 percent a

year ago. The average sales price of a foreclosure property was down nearly 2

percent from the fourth quarter and 1.5 percent from the first quarter last year,

the firm said.

Trends Nationwide

Nevada leads the pack in the nation with foreclosure sales accounting for 53

percent of all home sales. That was down from 59 percent the year before. In

Arizona, foreclosure sales accounted for 45 percent of all home sales for the

quarter, down from 47 percent a year earlier. Several other states had

foreclosure sales that accounted for at least one quarter of all home sales in the

first quarter: Georgia, Michigan, Ohio, Virginia, Oregon, Idaho, Florida,

Illinois, and Colorado.

2129 E Warner Rd, #104, Tempe, AZ 85284 * Phone 602.492.7469 * ShowAppeal.com

So while foreclosures may be slowing, a true recovery from the repressed

housing market remains to be seen.

2129 E Warner Rd, #104, Tempe, AZ 85284 * Phone 602.492.7469 * ShowAppeal.com