by Bill McBride on 2/18/2015 03:18:00 PM
Wednesday, February 18, 2015
During the recession, I started following the Sacramento market to look for changes in the mix of houses sold (equity, REOs, and short sales). For some time, not much changed. But over the last 2+ years we've seen some significant changes with a dramatic shift from foreclosures (REO: lender Real Estate Owned) to short sales, and the percentage of total distressed sales declining sharply.
This data suggests healing in the Sacramento market and other distressed markets are showing similar improvement. Note: The Sacramento Association of REALTORS® started breaking out REOs in May 2008, and short sales in June 2009.
In January, 16.6% of all resales were distressed sales. This was up from 12.8% last month, and down from 19.5% in January 2013. Since distressed sales happen year round, but conventional sales decline in December and January, the percent of distressed sales bumps up in January (seasonal).
The percentage of REOs was at 9.2%, and the percentage of short sales was 7.4%.
Here are the statistics for January.
Click on graph for larger image.
This graph shows the percent of REO sales, short sales and conventional sales.
There has been a sharp increase in conventional (equity) sales that started in 2012 (blue) as the percentage of distressed sales declined sharply.
Active Listing Inventory for single family homes increased 24.8% year-over-year (YoY) in January. In general the YoY increases have been trending down after peaking at close to 100%. This is the smallest YoY increase in inventory since June 2013.
Cash buyers accounted for 20.6% of all sales (frequently investors).
Total sales were down 5.2% from January 2014, and conventional equity sales were down 1.8% compared to the same month last year.
Summary: There was a seasonal bump in the percent of distressed sales, but overall this is an improving market.