This article first appeared in the St. Louis Beacon, May 30, 2013: Although foreclosures still account for one in five U.S. residential sales, the numbers continued to decrease in the first quarter of 2013, and short sales were also declining, according to an online marketer of foreclosed properties.
A total of 190,121 properties that were either already bank-owned or still in some stage of foreclosure accounted for 21 percent of all U.S. residential sales from January-March of this year, according to the report released Thursday by RealtyTrac. That was a decrease of 22 percent from the same period in 2012, when foreclosures accounted for one in four sales. During the first quarter of 2009, foreclosures accounted for nearly half -- 45 percent -- of sales.
According to the RealtyTrac analysis, short sales of properties not in foreclosure accounted for 15 percent of sales during the first quarter, bringing the total of distressed sales to 36 percent. The number of short sales was on the decrease, down 10 percent from the last quarter of 2012 and 35 percent from the first quarter of 2012.
RealtyTrac attributed the decrease in short sales to rising home prices, adding that the decline was surprising considering the large number of U.S. homeowners – 11 million – who are still underwater on their mortgages.
Daren Blomquist, vice president of RealtyTrac, said in a statement: “Underwater homeowners may be willing to stick it out a few more months or even years in the hope that they will be able to walk away with money at the closing table and without a hit to their credit rating, and for lenders a failed short sale may no longer translate into bigger losses down the road given that average prices of bank-owned homes are rising -- at a faster pace than non-distressed home prices in many markets.’’
Among the report’s findings:
- Foreclosure-related sales in Illinois accounted for 32 percent of total residential sales, ranking the state among those with the highest first-quarter percentages.
- Despite a nationwide decrease in the sales of properties owned by banks, 11 states saw an annual increase, including Missouri (27 percent) and Illinois (35 percent).
- The prices of bank-owned properties in Missouri increased 17 percent compared to a year ago, ranking it among the states with the highest increases.
- Illinois had 12,657 foreclosure-related sales during the first quarter. The average price of $126,192 represented a 38 percent discount when compared to non-foreclosures.
- In Missouri, foreclosure-related sales totaled 3,537 at an average sales price of $87,742. That represented a 37 percent discount when compared to non-foreclosures.
The entire report is available on the RealtyTrac website.
