Rapidly Diminishing REO Foreclosure Sales


BEN LeBRUN

by Lawrence Yun, PhD., Chief Economist and Senior Vice President, NAR

  • The number of foreclosed home sales has been rapidly falling and could essentially vanish by next year.  Those who specialize in foreclosure sales should therefore look towards other line of business.
  • In August, foreclosed sales comprised only 6 percent of all home sales transactions, down from double-digit figures last year and from near 30 percent few years further back.
  • In addition to fewer distressed properties on the market currently, there is very little in the pipeline.  The number of foreclosure starts is essentially back-to-normal with only 0.4 percent of mortgages undergoing that process.  Moreover, mortgages originated in the past four years are one of the best performing with very little defaults.
  • We should nonetheless be mindful that the overall count of seriously delinquent mortgages and those homes in some stage of foreclosure process are still above historical normal…

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