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Short Sales: Has Their Time Finally Arrived?

by The KCM Crew on August 29, 2011 · 5 comments

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Last week, RealtyTrac released its Q2 2011 U.S. Foreclosure Sales Report. The report confirmed what we are hearing in the marketplace – banks are beginning to look more favorably on short sales as option to foreclosure.

The report dissected the sales of distressed properties in the second quarter of 2011. Here are several of their findings:

  • Sales of homes that were in some stage of foreclosure or bank owned accounted for 31 percent of all U.S. residential sales in the second quarter of 2011, down from nearly 36 percent of all sales in the first quarter.
  • A total of 102,407 pre-foreclosure homes (short sales) sold in the second quarter, an increase of 19 percent from the previous quarter.
  • A total of 162,680 REO homes (foreclosures) sold in the second quarter, virtually unchanged from the first quarter.
  • Short sales on average sold for a discount of 21 percent below the average sales price of non-foreclosure homes.
  • REOs on average sold at a discount of nearly 40 percent below the average sales price of non-foreclosure homes.

This could be a great sign that banks are finally realizing the advantages of short sales over foreclosures.

Bloomberg.com quoted Rick Sharga, senior vice president of RealtyTrac, in an article covering the report:

“This is a glimmer of hope that lenders are getting more realistic. It’s a win for borrowers who avoid foreclosure, buyers who get a house in better condition and banks that lose less money, which is also a win for taxpayers.”

Bottom Line

Banks are beginning to do more short sales. It is time for everyone involved to help in this endeavor. Tomorrow, we will have a short sale expert, Christopher Reale, blog on gaining the right mindset to do just that.

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We at The KCM Crew are pursuing our mission of building a home for real estate information. We are truly dedicated to helping real estate professionals by supplying all the tools and resources they need to be seen as industry leaders in their marketplace. See how we can help you become an industry leader in your marketplace, and be sure to check out our page on Facebook and follow us on Twitter.

  • http://www.grandrapidsshortsaleagents.com/ Grand Rapids Short Sale Agents

    All I can say is “ITS ABOUT TIME”!! I have been doing West Michigan Short Sales for years! When all the other agents were running saying they were too difficult, I was at the school of hard knocks learning all I could. It is so nice to see that the banks are finally realizing that not only do the sellers minimize their damage but so do the banks!!

  • http://www.homesofcolumbiacounty.com Joe Loomer

    Still been a hard road to hoe in our area – where short sales only account for just under 2% of all sales.

    Navy Chief, Navy Pride

  • Pingback: Short Sales: Has Their Time Finally Arrived? | Richard Barrow Utah Mortgage Professional

  • Pingback: Short Sales: Has Their Time Finally Arrived? | Richard Barrow Utah Mortgage Professional

  • Stephen Foster

    why not see if the bank will do a cram down? Reduce the amount that is owed by the home owner. I just did one, it worked very well the BOFA took off 35% of the debt..gave the owner a 10 yrs to pay the balance off at 0%..in doing research I had learned that the BOFA had LOST all the paper work..when they took over the note..and HAD nothing and there fore rather than face a length audit and legal fees, they offered the cram down..win win ..for everyone..Cram Downs are nothing new, Commercial lenders are doing them..it’s faster and is many cases easier..down the road the property owner lists the property the Agent that worked with the owner looks like his hero and I will tell you my name is out there and I get calls for either help or to list or buy !!

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