Nearly Half of December Home Sales Distressed

January 24, 2011 No Comments »

distressed

The distressed share of home sales surged to 47.2 percent in December, according to the Campbell/Inside Mortgage Finance HousingPulse Tracking Survey released today.

It was up from 44.5 percent in November, and nearly matched the all-time peak of 47.5 percent seen back in September, before the robosigning scandal put things on ice.

The share was highest in the Golden State, where a staggering 66 percent of all transactions involved distressed properties.

And the similarly hard-hit states of Arizona and Nevada saw distressed sales grab a 62 percent share.

Distressed sales include homes in some stage of foreclosure, along with short sales, where properties are sold for less than the existing mortgage balance.

Bucking the trend were Louisiana, Oklahoma, and Texas, where just 29 percent of all transactions were deemed distressed.

First-Time Buyer Share Also Jumped

Sales to first-time homebuyers also ticked higher month-to-month, rising from a share of 34.4 percent to a 37.7 percent share in December.

It is believed that fear of mortgage rate hikes prompted the demand – however, at the same time, investors shied away from buying due to concerns home prices would decline.

The first couple months of the year are traditionally weak, so 2011 isn’t expected to get off to a great start, especially with all that shadow inventory weighing down prices.

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