Foreclosures made up about one-third of all home sales during the spring quarter (April to June), and sales were about six times the percentage of foreclosures in a healthy housing market, RealtyTrac Inc. reports.
Foreclosure sales likely would have been much higher too if so many banks hadn’t slowed their foreclosure processes while state and federal officials continued to investigate possible faulty practices. Foreclosure sales — which include homes purchased after they receive a notice of default or that were repossessed by lenders — peaked two years ago at 37.4 percent of sales, compared to 31 percent in the April to June quarter.
During the second quarter, 265,087 homes sold were in some stage of foreclosure or owned by banks — but that’s down 11 percent from the same period a year ago, RealtyTrac reports.
The state with the highest number of foreclosure sales was Nevada, where foreclosure sales accounted for 65 percent of all sales. Arizona followed with foreclosure sales accounting for 57 percent of all home sales for the quarter.
Foreclosures Continue to Weigh on Home Prices
Foreclosed homes continue to sell for less than other homes. During the spring, bank-owned homes sold for 40 percent less than the average price of other homes. Sales of homes in the foreclosure process or short sales sold for 21 percent less than the average home sold.
The average sales price of a foreclosed property was $164,217, a drop of less than 1 percent from the January-March quarter and a nearly 5 percent drop from the April-June quarter in 2010.
Source: “Foreclosure Sales This Spring were 6 Times Higher Than in Healthy Housing Markets,” Associated Press (Aug. 25, 2011)