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In the monthly REALTORS® Confidence Index Survey, NAR asks REALTORS® about the characteristics of their last sale for the month. For reported sales for April 2015, distressed sales accounted for 10 percent of sales (10 percent in March 2015; 15 percent in April 2014). About 7 percent of reported sales were foreclosed properties, and about 3 percent were short sales.[1]
With rising home values and a declining foreclosure inventory (except for states with judicial foreclosures such as NY, NJ, CT), sales of foreclosed properties have declined as well. The decline in foreclosed properties on the market may help to explain to some degree why investment sales have generally been on the decline.
Foreclosed property sold at an average 20 percent discount, while short sales sold at an average 14 percent discount. For the past 12 months, distressed properties in “above average” condition were discounted by an average of 9-11 percent, while properties in “below average” condition were discounted at an average of 15-20 percent. Having fewer foreclosures creates further pressure for prices to move up in the coming months.
[1] The survey asks respondents to report on the characteristics of the most recent sale for the month.
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