Sales of distressed properties made up a larger share of home sales in 2013 than in 2012 RealtyTrac said today. Short sales and sales of bank-owned real estate (REO) together made up 16.2 percent of residential sales during the year, an increase from both 2012 (14.5 percent) and 2011 (15.2 percent.)
REO sales during the year totaled more than 436,000 units or 9.3 percent of all U.S. residential sales, up from 9.1 percent in 2012 and 8.7 percent in 2011. There were more than 256,000 short sales (where the lender agrees to accept less than the outstanding balance of the seller's loan) accounting for 5.8 percent of all sales compared to 4.9 percent of all sales in 2012 and 6.0 percent in 2011.
"It may surprise some to see distressed sales rising in 2013 given that new foreclosure activity dropped to a seven-year low for the year," said Daren Blomquist, vice president at RealtyTrac. "And while short sales did trend lower in the second half of the year, there are still more than 1.2 million properties in the foreclosure process or bank-owned, providing a sizable pool of inventory that the housing market is in the process of absorbing. Meanwhile, non-distressed sellers have not listed their homes for sale in droves, helping to keep the distressed share of sales at a stubbornly high level."
In addition to short sales and REO more than 48,000 properties sold to third parties at foreclosure auction in 2013. This was 1.0 percent of residential sales compared to 0.5 percent in the two prior years.
Along with annual statistics RealtyTrac's U.S. Residential & Foreclosure Sales Report included data for December. Sales of single-family homes, condos and townhomes during the month were at a seasonally adjusted annual rate of 5.17 million, less than a 1 percent increase from November and a 10 percent jump from December 2012.
Sales of REO accounted for 9.3 percent of December sales compared to 8.7 percent in November and 9.2 percent a year earlier. Short sales had a 5.7 percent market share, up from 5.1 percent in November but a full percentage point lower than in December 2012. Sales at foreclosure auctions accounted for 1.2 percent of sales in December, up from 1.1 percent in November and 0.8 percent in December 2012.
The national median sales price for residential properties in December was $168,391, virtually unchanged from November and up 2 percent from December 2012. The median price of a distressed property was $108,494, 38 percent less than the median price of a non-distressed property, $174,401.
Institutional investment in residential properties continued to rise with 7.3 percent of sales in 2013 going to investors who purchased 10 or more properties within a year. This was an increase from 5.8 percent in 2012 and 5.1 percent in 2011. In December institutional investors accounted for 7.9 percent of sales, up from 7.2 percent in November.
