From the Record:
Almost one in three homes sold in the U.S. in the second quarter were owned by banks or in some stage of foreclosure, RealtyTrac reported today. In New Jersey, where foreclosure activity has been stalled for most of this year, about one in seven homes sold was either owned by a bank or in the foreclosure process.
Because these properties sell for deep discounts, they offer opportunities for bargain hunters, said RealtyTrac’s CEO, James J. Saccacio.
“This report is clearly good news for well-positioned buyers and investors looking for bargain real estate that will build them wealth in the long term and often cash flow as rental real estate in the short term,” Saccacio said. RealtyTrac follows the foreclosure market nationwide.
Distressed sales were most common in the troubled real estate markets of Nevada, Arizona and California, RealtyTrac said. In Nevada, for example, foreclosure-related sales accounted for 65 percent of all sales.
The average sale price of a home in foreclosure or owned by a bank was 32 percent lower than the average sale price of homes not in foreclosure. In New Jersey, the discounts were even bigger, ranging from about 31 percent for homes sold as short sales — when a bank allows a home to be sold for less than the amount owed on the mortgage — up to 53 percent for bank-owned homes.
RealtyTrac also found that short sales took on average 245 days in the second quarter, down from 256 in the first quarter. Sacaccio called that a sign that the housing market is “starting to focus on more efficiently clearing distressed inventory, at least in some areas.”
Real estate agents and prospective buyers have complained that lenders have been slow to approve short sales, often leading buyers to give up in frustration.