by Bill McBride on 5/19/2015 01:27:00 PM
Tuesday, May 19, 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 April, 11.9% of all resales were distressed sales. This was down from 12.4% last month, and down from 16.3% in April 2014. Since distressed sales happen year round, but conventional sales decline in December and January, the percent of distressed sales bumps up in the winter (seasonal).
The percentage of REOs was at 6.5%, and the percentage of short sales was 5.5%.
Here are the statistics.
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 26.0% year-over-year (YoY) in April. In general the YoY increases have been trending down after peaking at close to 100%, however the YoY increase was slightly larger in April than in March.
Cash buyers accounted for 16.4% of all sales (frequently investors).
Total sales were up 8.9% from April 2014, and conventional equity sales were up 14.6% compared to the same month last year.
Summary: This data suggests a healing market with fewer distressed sales, more equity sales, and less investor buying.