by Bill McBride on 7/10/2015 03:08:00 PM
Friday, July 10, 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 a few years, not much changed. But over the last 3 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 June, total sales were up 21.7% from June 2014, and conventional equity sales were up 25.4% compared to the same month last year.
In June, 10.7% of all resales were distressed sales. This was up from 9.8% last month, and down from 13.3% in June 2014.
The percentage of REOs was at 4.8% in June, and the percentage of short sales was 5.8%. Note: It has been some time since there were more short sales than REO sales in a given month.
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 decreased 10.0% year-over-year (YoY) in June. This was the second consecutive monthly YoY decrease in inventory in Sacramento (a big change).
Cash buyers accounted for 16.0% of all sales (frequently investors).
Summary: This data suggests a healing market with fewer distressed sales, more equity sales, and less investor buying.