Home Ownership

Home buyers and sellers, as well as investors, are trying to figure out the future of real estate in the coming year. Depending on their position, interested parties are exploring different areas of real estate. Individuals and organizations focus on everything from property value levels to interest rates to REIT (Real Estate Investment Trust) debt levels.

Commercial Real Estate

Real-estate fund managers have expressed confidence in the future of commercial real estate. According to portfolio managers, recovery is underway in the current market. The improvement is spurred on by low interest rates, favorable cash flows, and increased demand.

This group analyzes national and regional trends. Using this data, they decide on the most promising property sections and regions. Sectors such as apartments with short leases suffered in the economic downturn but they are expected to rebound in this recovery stage. As corporate travelers return to the road, hotels are attracting the attention of investors.

REIT Debt Level

With regards to REITs, industry experts pay attention to debt level compared to their earnings before taxes, interest, depreciation, and amortization.

Up, Up And Away

UK Business Property

In 2011, UK business property is also expected to be supported by low interest rates. Industry leaders believe that the Bank of England will not change the base rate until later in the year. On December 9th, the Monetary Policy Committee voted to maintain current levels.

Business property boosted by low interest rates in 2011?

Residential Property Value Levels

During 2011, home owners (and potential buyers) will be keeping an eye to property value levels. Within the past week, home owners in Victoria, British Columbia, Canada, were told about a slight increase in their property value assessments. During 2010, B.C. Assessment had frozen property values at 2007/2008 levels.

Of course, home owners are concerned about higher taxes associated with increased assessments. According to Cameron Muir, chief economist for the B.C. Real Estate Board, the increase in property values, however, may not result in a significant tax increase. Muir points out the positive aspect of higher property value assessments in a region.

"The increase would reflect stronger economic conditions and a healthier real estate market," said Cameron Muir, chief economist for the B.C. Real Estate Board, representing 12 real estate boards and almost 18,000 Realtors.

Residential housing sales in British Columbia should rise slightly in 2011. The province's economy is showing improvement with more employment and a larger population. Metro Vancouver is one popular area where home buyers can find affordable houses. Most likely, property prices will continue to rise in the coming year. Yet Metro Vancouver is still expected to be popular with home buyers especially with first-timers.

Greater Victoria property values buoyed by economic recovery

Will The Real Estate Market Level Out In 2011?

If people have an interest in real estate on any level, they should track market statistics. At present, the industry is experiencing a recovery. Yet there will be continued speculation about whether the market will level out or climb to new heights. Real estate predictions – even on a local scale - are not an exact science. A regional market can be affected by varied factors including external influences.

What Are Your Predictions For The Real Estate Market In 2011?

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As the current year winds down and 2011 approaches, readers can expect reports and articles about real estate trends to pop up everywhere. With so much trend-related content out there, our eyes can sometimes glaze over and we tend to ignore the latest list. Yet we should rethink our reaction to the barrage of year-end statistics.

Tracking Trends

Examining trends helps us to zone in on where we've been, gives us an idea of where we're going, and arms us with the knowledge to navigate the system. Real estate revolves around statistics. It is worth consumers' time and effort to examine the numbers and keep up-to-date about real estate trends.

Global Real Estate Trends

The Global Real Estate Trends report released by Canada's Scotiabank tracks housing markets in 12 major economies. The December report states that global residential property markets in 2010 experienced a modest but uneven recovery.

Australia

Australia fared the best with its housing demand and low unemployment. Slower sales and price appreciation, however, are expected for this thriving market in the coming months.

Japan

Meanwhile, Japan’s twenty-year property slump continued in the past year. In 2011, Japan's economy is expected to experience a further slowdown.

US

Stability is returning to U.S. markets. Housing demand is expected to rise with increasing employment numbers and continued low interest rates. Yet the Global Real Estate Trends report warns that housing demand might not translate into home sales. Within a recovering economy with a high unemployment rate (although shrinking), individuals and lenders are feeling uncertain and cautious about major financial commitments.

Canada

Despite a volatile market in 2010, Canada ranked high in the Global Real Estate Trends report.

Read about all 12 housing markets in the Global Real Estate Trends report.

Local Real Estate Trends

Potential home buyers and sellers should keep informed about state and local trends. Varied media (print or online) across the US and elsewhere publish information regularly about the latest real estate trends. The Washington Post tracks housing sales and prices in the Washington area. Each Saturday, the results are posted in their 'Real Estate' section. Information is collected for every residential zip code and the data is compared to the numbers during the corresponding period in the previous year.

Green Building Trends

'Green building' trends will make a noticeable difference to the real estate industry in the coming year. Regardless of uncertain economies, 'green building' is expected to rebound in 2011. New commercial start-ups will opt for green alternatives. Existing businesses will be making energy-efficient improvements.

This decision makes sense on many levels for businesses. Besides being environmentally-friendly choices, green businesses impress the modern customer. As well, residential buildings will follow this trend. Home owners want to live in a safe and healthy environment.

Parents and educators will also be advocating for 'green' schools. As part of the LEED system, the number of Certified Green Schools should increase as more people embrace the health and educational benefits of these buildings. By the middle of 2010, certified schools made up almost 40% of all new LEED projects in the US. In 2011 and beyond, the real estate industry will be seeing more 'green' buildings in all areas - commercial, educational, and residential buildings.

Green Building’s Top Ten Trends for 2011

What Do You Think Will Be The Top Real Estate Trends in 2011?

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After Christmas, shoppers follow Boxing Day sales and all the other reduced prices to be found at year's end. Meanwhile, the real industry is reflecting on the more memorable deals of 2010. Of course, new home owners will be remembering their own private real estate transactions. As well, more than one commercial transaction during this year made a powerful impression.

Commercial Real Estate

The National Association of Realtors (NAR) predicts a more stabilized market in 2011 as well as a decrease in commercial vacancies. When commercial assets reach stabilization, owners are pleased with the outcome. The properties are generating profits rather than eating away at an owner's assets.

Denver, Colorado

This thriving Colorado city saw commercial real estate investments double year-over-year in 2010. In fact, Denver made the top ten list of preferred markets for investment during the past twelve months. Since many Denver commercial assets are stabilized, investors are targeting these properties.

Within this market, buyers cannot expect to find a good deal in terms of low prices. Yet investors are willing to pay a higher price for a stabilized asset. The purchase still adds up to a wise investment in the long term. During the coming year, Denver's commercial market is expected to see more big deals. The anticipated early 2011 sale of the 1800 Larimer building for $400 per square foot will be a record breaker (the 'per-square-foot record' for the sale of an office building in Denver).

Denver Commercial Real Estate Closes 2010 with a Bang

Hartford, Connecticut

In July 2010, Connecticut River Plaza, a well-known office property in downtown Hartford, was sold for $6,666,667 to a limited liability corporation in New York. This sale was one of the most anticipated transactions in the recent history of downtown Hartford’s commercial office market.

Winnipeg, Manitoba

During the past year, commercial property sales and leasing broke records in Winnipeg, Manitoba. This Canadian city can boast about $544.7 million of property sales between January-October, 2010. Winnipeg's yearly average for commercial sales is $300 million. One of the year's biggest sales transactions was the purchase of GEM Equities/B&M Land Co. property (three high-rise apartment blocks) by Toronto-based Timbercreek Asset Management for a reported $100 million.

Banner year for property purchases

Luxury Markets

New York City, New York

Throughout 2010, the NYC hotel industry was a vibrant market – the site of tons of transactions and substantial deals. In September, JRK Hotel Group sold the Hotel Roger Williams for $90 million (and $4.5 million in additional costs) to LaSalle Hotel Properties. The luxury hotel market is rebounding and investors have confidence in the Manhattan hotel scene.

Montreal, Quebec

Montreal has a smaller luxury market than New York City. Yet there is a growing demand for high-end condos. The sale of the penthouse at the Ritz Carlton Montreal Hotel and Residences brought in $13 million plus taxes – the highest price ever for a residential property in Quebec.

Distressed Properties

Of course, most real estate deals in 2010 were outside the luxury market. Interested buyers had abundant opportunities to pick up affordable properties. Even investors wanting to buy into the New York City hospitality industry were able to pick up distressed hotels at bargain prices. As well, home buyers across the country were paying discount prices for foreclosures.

Did You Find A Good Real Estate Deal In The Past Year?

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If you could catch a flight from the closest major airport to Santa's home in the North Pole, you would have to depart from Fairbanks, Alaska. Yet if a trek to the Geographic North Pole sounds a bit daunting, you cam always visit the 'City of North Pole' – a ten-mile drive southeast of Fairbanks. Actually, the City of North Pole is a 'jolly good' alternative.

City of North Pole

This scenic town with more than 2,200 residents is known as the place "where the spirit of Christmas lives year round." The City of North Pole offers year-round Christmas decorations, seasonal street names, and light poles decked in a candy cane motif. There is even a Santa Claus Lane with three consecutive traffic circles within a quarter mile.

The world-famous Santa Claus House is the most popular attraction in this northern town. Even mailing a letter takes on a whole new meaning in this festive city. Mail postcards from the U.S. Post Office and your family and friends – young and old – will have the pleasure of receiving mail from North Pole, Alaska. (Holiday tip – Santa's zip code is 99705.)

No doubt, the City of North Pole is the perfect place for a holiday visit or stopover at any time of year. Yet this holiday town is a year round home for many people. A huge part of the town's claim to fame is its proximity to Santa Claus but the City of North Pole is also a primary energy center.

The city is home to two oil refineries and the largest electricity-producing generator in the Interior of Alaska. As well, the community is situated between two military bases - Ft. Wainwright and Eielson AFB. More than 30,000 people live in the 'Greater North Pole' area and this small town serves as the commercial hub in this northern region.

North Pole Home Sales

If you want to live near Santa year-round, expect to pay in the range of $221,000 (average listing price). A few area homes are selling in the $150,000 range (or even for lower prices). Other houses are priced closer to $300,000.

Within Santa's zip code (99705), last week's average listing price was $221,952 (a .3% increase). Actually, Santa's zip code was the most popular zip code for the second week before Christmas. That number is not a surprising statistic as Christmas nears and people want to get closer to Santa Claus.

Currently, there are 182 resale and new homes in North Pole listed at a real estate website. Even though the City of North Pole has a festive theme, the town cannot escape all the realities of modern life. Of course, foreclosures do not represent a significant percentage of North Pole home sales. Seven out of the 182 homes for sale, however, involved houses in pre-foreclosure, auction, or bank-owned stages of the foreclosure process.

Yet whatever the roadblock, the City of North Pole, Alaska, seems to be conducive to keeping up one's spirits and, eventually, finding the right direction. After all, Santa has been doing that for centuries – and it is his neighborhood, too.

City of North Pole, Alaska

Would You Like To Live In North Pole, Alaska?

Within the US and Canada, sales of townhouses are 'going to town' (moving ahead in a vigorous manner). The term 'townhouse' has varied meanings in different countries. Historically in the UK and Ireland, 'townhouse' referred to the residence of a member of the aristocracy in a capital or major city. Famous townhouses are 10 Downing Street, residence of Prime Minister David Cameron, or Clarence House, home of the late Queen Elizabeth, the Queen Mother, and now the residence of Charles, Prince of Wales.

What are Townhouses?

Today in North America, this type of housing (either single-family or multiple-family dwellings) has a small "footprint." Usually, a townhouse is within minutes (either walking or with public transportation) of a city's business and industrial areas. Townhouses have been compared to a compromise between a condo and a regular home.

This housing category can include homes in the luxury market as well as more affordable houses. Superb examples of luxurious townhouses can be found in New York, Boston, Chicago, Toronto, Philadelphia, and San Francisco.

Why do People Buy Townhouses?

Part of the current appeal of townhouses is the wide range of prices. There is a townhouse for every budget and all age groups. Townhouses interest everyone from first-time buyers to empty-nesters who are downsizing to a smaller home. A first-time home buyer views a townhouse as an affordable alternative to a detached house. Building fees can cover issues such as snow removal, landscaping, or maintenance of the building's exterior.

Sometimes there is more demand for townhouses than can be supplied by the market. Wendy Jabusch, general manager of Hawthorne Homes, speaks about Canadian real estate and townhouses.

"Recent research shows that available townhome product -- homes started or available for pre-sale -- is only 14 per cent of the new construction market. The remaining 86 per cent of multi-family product is apartments," says Wendy Jabusch of Hawthorne Homes.

What does the Future Hold for Townhouses?

There has been a recent increase in townhouse developments. Construction starts of townhouses counted in at 250 in Calgary, Alberta during October, 2010. According to Canada Mortgage and Housing Corporation, that statistic showed the strongest month in 21 years for townhouse starts. Of course, there were fewer new townhouse constructions in 2009 because builders were working though units already in production.

Home buyers gravitate to townhouses for several reasons. Townhouses offer good value, attractive design, and lifestyle benefits. President and partner Tim Logel of Cardel Lifestyles says that he has found that townhouses have maintained their popularity since Cardel's first development in 2002. Logel is optimistic about townhouse sales in the coming year.

"I expect 2011 to be a strong year for townhome sales as affordability and the job market improves in Calgary," says Tim Logel of Cardel Lifestyles.

City homebuyers go to town

Manhattan Townhouses

New York City townhouses never lose their appeal. It is easier to get financing for a city townhouse than a NYC co-op. Generally, lenders look upon a Manhattan townhouse purchase as a wise investment. If you buy a townhouse as an investment, rental income can take care of the monthly mortgage payment.

Financing A Manhattan Townhouse

Are You Planning To Buy A Townhouse?

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Many people find it difficult to sort through the barrage of real estate statistics. After all, there are real estate numbers released on a quarterly, monthly, bi-weekly, and even weekly basis. Potential home buyers and home sellers must wade though scores of information before making a final decision.

Confusing Stats

It is not surprising that real estate numbers can be a confusing lot. After all, real estate is full of statistics. Remember Mark Twain's classic quote.

"There are three kinds of lies: lies, damned lies, and statistics." ~ Mark Twain.

No doubt, statistics have a questionable reputation. Generally, they are not 'lies' but Mark Twain (and others who have used this quote or a similar version) was probably referring to the persuasive power of numbers. Statistics can be used to bolster weak arguments. On the other hand, they might be dismissed by people on the opposing side of the statistics.

In addition, there is the odd journalist who goes out of their way to make an extraordinary headline out of ordinary statistics. Writers need to grab the readers' attention. Shocking or scary statistics are bound to garner interest and publications are not blind to that fact.

If there were 4,000 home sales in October and 3,800 home purchases in November, readers can expect the headline – Home Sales in Definite Decline. The journalist has published correct information. In this fictional example, home sales declined in November but the article might leave out a few important numbers. The author might not refer to the 5,200 sales in September or the 3,700 home purchases in August.

Statistics show the facts but they can hide the 'ebb and flow' of events. Long-term effects can be influenced by several external factors. A short-term statistic shows a more narrow perspective. They represent the "here and now."

Long-Term Commitment

Home buyers and sellers are facing decisions with long-term effects. They have to take a look at today's statistics but they must also examine tomorrow's outlook and future possibilities. A long term commitment requires exploring a broader range of statistics than this week's numbers. Home buyers and sellers must decipher overall trends and year-to-year comparisons.

They should view and review real estate statistics. Buying a house is a serious decision because you are buying "your home." Even if you are just looking at a home purchase as an investment, it requires commitment. If you hold on to the house for the long term, it can be a worthwhile investment – no matter which shocking statistics appear in the interim.

Through extensive research, individuals can get a better feel for the real estate market. Buyers and sellers need to ignore all the hype and stick with the basics. For example, a home buyer should be able to answer 'yes' to a few basic questions before they decide on home ownership.

Basic Questions for Home Buyers

• Do you have a good credit score? 
• Do you have a steady job or career? 
• Do you have a stable income? 
• Do you plan on being in this location for more than 4 years? 
• If you own a home, have you owned it for longer than 5 years?

WHAT DO THESE TORONTO REAL ESTATE NUMBERS MEAN, ANYWAY?

Are You Ever Confused By Real Estate Statistics?

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Real estate flipping refers to buying low and selling at a higher price. With the typical "fix and flip," an investor will buy a home selling for a low (often, very low) price. The deep discount in the home's purchase price may have come about for varied reasons from a state of disrepair to home owners' divorce to pending foreclosure.

Flipping Homes for Good Reasons

The investor will perform any necessary repairs and put the house back on the market in the hopes of making a profit. There is nothing wrong with this scenario if everything is carried out in a proper manner. In fact, the transaction can have a positive effect on many levels.

The home seller gets rid of the home. Obviously, the seller wanted (or had to sell) the house. The sale can free sellers to relocate or move on with their lives as in the case of divorce. Even with the stressful process of foreclosure, the actual sale puts an end to the stress of 'pending' foreclosure. It allows people to move forward in a new direction.

An investor puts an improved home on the market. That process has general overall benefits to the economy. The renovation companies and building suppliers get business. The neighbourhood gets a nicer home and a bonus - increased property values. Even the system gains with higher property tax assessment value and sales tax on the renovation supplies.

Flipping Homes for Bad Reasons

Yet sometimes flipping homes can either border on fraud or be all-out fraud. Flipping homes can be part of a criminal scheme. The investor in illegal property flipping is not concerned with home buyers, the neighborhood, or even making a reasonable profit through honest efforts.

Illegal flipping is a 'fraud-for-profit' scheme. The investor acquires property and resells it for a considerable profit at an artificially inflated value. The property is put back on the market in record time.

If the home required repairs, they either will not be completed or will just undergo a superficial fix. The new buyer may not be aware of the situation. The buyer borrows to finance the purchase and the lender gets drawn into the fiasco. This type of fraud is costly for lenders because it involves a substantial loss.

Of course, an illegal property 'flipper' needs help to carry out the scheme. Illegal property flipping usually requires collusion between an investor, real estate appraiser, mortgage originator, and closing agent. The appraiser plays a big part in the scam. A false and artificially inflated appraisal is necessary for the successful completion of this criminal scheme.

When Flipping Homes Turns Ugly

Illegal property flipping can end up in an ugly mess. One example would be the recent complaint filed in Manhattan federal court on December 14 against sellers, appraisers, and even lenders. All parties allegedly conspired to commit mortgage fraud.

According to the current civil lawsuit, sellers allegedly purchased 17 homes and 'flipped' them without proper improvement to inexperienced, low-income buyers who could not afford the properties. The appraisers allegedly overstated the value of these homes in their appraisal reports. As well, a mortgage lender allegedly underwrote mortgages for the buyers with the knowledge of the false appraisals and inability of the buyers to afford the mortgage payments.

Read more about what happens when flipping homes turns ugly....

Have You Been The Victim Of Illegal Property Flipping?

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Unless you are in a hot climate, November and December can be chilly months. This year, parts of the US and the UK are living through an early winter. Home sellers in these countries have also been experiencing a chilly period.

Los Angeles

Although Los Angeles might have warm temperatures, there has been a cooling down period in the housing market. During November 2010, the Los Angeles County housing market saw quite a slowdown. Home sales fell 21% compared to purchases in 2009. Condos sales had even a worse showing. Last year, 4,315 homes had sold in this region throughout November. Only 3,423 homes were purchased during the same period in the current year.

Sales were down 9% from October. Often home sales will decline somewhat in late autumn as the market heads towards winter. Yet the median price in Los Angeles County did not show much movement. In fact, median price was at almost the same place as in summer.

In a November 23 report, the California Association of Realtors suggested that the average home seller is not prepared for these chilly times. The housing market is in the midst of change. People must be willing to participate in a different game on an unfamiliar playing field. Leslie Appleton-Young, association chief economist, explains the "new reality."

"We're really seeing two different housing markets: one at the lower end driven by first-time buyers and investors, which is keeping prices stable, and one with nostalgic sellers who set unrealistic asking prices," says Leslie Appleton-Young, chief economist of the California Association of Realtors.

As well, Michael Nourmand, president of residential brokerage Nourmand & Associates, has noticed that buyers and sellers are finding it hard to adjust to a new market. Home sellers tend to think about the previous popularity of an area or earlier neighborhood prices. Yet sellers must think in the "here and now." In uncertain times, affordable options (such as fixer-uppers) are a big draw.

November Ushers In a Big Chill for Home Sellers

UK

In the UK, home sellers cut asking prices by 3% in December. These figures represent the worst December performance for home sale prices in three years. The statistics show the steepest decline since the 3.2% drop in 2007. Home purchase prices have now fallen during five of the past six months in all regions of England and Wales. The West Midlands saw the worst fall at 5% but Wales escaped with a mere 1.3% decline.

Despite a demand for homes and interest in quality homes and popular neighborhoods, dreams do not always translate into actual sales. Negative factors can come in to play to outweigh positive circumstances. Miles Shipside, director of Rightmove, explains part of the problem in the current UK housing market.

"The fact that many would-be buyers do not have the ability to proceed, and some homeowners find themselves in a position where they are forced to sell, drives prices down," states Miles Shipside, director of Rightmove.

Rightmove believes national home sales prices will at least remain flat in 2011. In fact, they predict the worst scenario could be a 5% decline because many homeowners are facing repossessions.

Home Sellers Forced To Slash Asking Prices

Are Home Sale Prices Experiencing A Chill In Your Neighborhood?

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With its home values increasing by almost $11 billion in 2010, the Boston housing market is going in the opposite direction of the national trend. According to Zillow.com, Boston real estate is a better and brighter market. Since the city is now in a more favorable position than the rest of the country, its market will enter 2011 in great shape.

Home Values

As the housing market stabilizes, Boston should continue as a bright spot. Keep in mind that the city's current home values are an impressive lot. After all, U.S. home values are expected to lose $1.7 trillion this year. That decrease is 63% more than the $1 trillion decline in 2009. The latest figures confirm that total value lost since the 2006 market peak has been $9 trillion.

Home values had been appreciating from 2003 to 2005 (and in certain instances, during 2006). When subprime mortgages became popular, home owners believed that their houses would continue to increase in value. The rate was unsustainable, however, even with the help of government interventions such as the expired Federal Homebuyers' Tax Credit.

The market referred to as the 'Boston Metropolitan Statistical Area' was just one of two shining lights in the recent statistics. San Diego also showed an increase of $10.2 billion in home values.

Surprising Statistics

Now the Boston statistics were a bit of a surprise – at least to Robert Murphy, an economist at Boston College. He referenced the S&P/Case-Shiller Home Price Index (a measure for the U.S. residential housing market). Murphy believed that they reported home values in Greater Boston had not fallen as far as in other U.S. regions.

Yet despite his surprise at the latest statistics, this economist had to admit that Boston is enjoying a positive economy. Murphy pointed to two main industries (health care and education) stabilizing the Boston housing market as well as employment sectors. He reminds everyone, however, that Boston home values are still down $105 billion from their peak in 2005.

"The state’s unemployment rate is 8 percent, vs. 10 percent nationwide, so we’ve done better in that sense too,” says Robert Murphy, Boston economist, explaining the city's encouraging economy.

Foreclosure Effect

Is it possible that foreclosures are affecting recent statistics about Boston home values? Probably not! Yet Boston has seen its share of foreclosures.

There were 11,334 foreclosures from January-October in Massachusetts – an increase of 7,710 from 2009. Median prices for single-family homes, however, have increased since July. It will take six months (or even longer) though for downward pressure on median home prices to be felt in the market.

Hub home values up by $11B

Falling Home Values

New York City had the biggest decline at $103 billion and Chicago experienced $48 billion in losses. The value of homes in the Chicago metropolitan area is expected to fall 7.1% (to $625.8 billion) this year compared to 2009. The predicted loss of $48 billion is a better showing than the 2009 $66.7 billion loss. A local real-estate agent believes that Chicago home values will decline another 2%-3% during 2011. That fall would be a result of increased foreclosures and short sales.

Chicago’s home values dropping — but 2010 better than 2009

What Is The State Of Home Values In Your Area?

Home buyers might expect to purchase a foreclosure for a bargain. Yet probably few buyers would be hoping for a 45% discount. According to Realty Trac, however, sales prices for Ohio foreclosures reached that low point in the third quarter of 2010.

Falling Prices

Purchase prices for foreclosures did not fall to that extent in every state. Yet foreclosures sold on the average for 32% less than non-foreclosure sales. In the second quarter, foreclosures sold for just 26% less than other homes. They could be purchased for 29% less in 2009. Realty Trac CEO, James Saccacio, said that he had never seen such disparity in prices of foreclosures and non-foreclosures since 2005.

The overall best deals went to buyers who picked up REOs (real estate owned by the bank after repossession). REOs were selling 41% lower than non-foreclosures in the summer and early autumn of the current year. That percentage means that a $300,000 foreclosure was selling for $177,000. A huge discount!

Distressed Properties

Of course, REOs may not be in prime condition. That factor is at play in the discount prices for certain foreclosure sales. Home buyers must always be realistic about purchasing distressed properties. These homes will need extra tender loving care – an investment of time, effort, and money. Home buyers must understand the implications of buying homes in less-than-mint condition.

If buyers are willing to take on the challenge, however, they will be getting a good deal in the current market. While the average price of homes rose 6.4% from the second to third quarter in 2010, distressed property prices fell 2.5%. Non-foreclosure sale prices rose to an average of $250,000 and foreclosure purchase prices fell to $170,000.

Behind the Scene

Home sales had dropped after the end of the Federal Homebuyers' Tax Credit. As well, more foreclosures came on the market. Buyers had plenty of choices. If homes were not set at favorable prices, they could just sit on the market for an indefinite period.

Getting Rid of REOs

REOs have been returned to lenders but they are still eager to get rid of the properties. REOs come with a cost for bankers. Actually, lenders would prefer to take a low price rather than carry the cost of the home for months.

Buy A Foreclosure - Save 30% On The Price

REO Statistics

Even with the deeply-discounted prices, however, REO sales dropped during the third quarter. Since home sales also fell, foreclosures still occupy the same share of the market. Yet REOs remained popular with many home buyers.

Nevada had the highest percentage (54%) of REO sales in the third quarter of this year. Yet these figures were 2% lower than sales for the second quarter. Other states also showed high numbers of foreclosure sales. In Arizona, foreclosures accounted for 47% of home sales. Foreclosures within California made up 40% of all home purchases.

In Massachusetts, more than one third of home sales during July-September were foreclosures. The fourth quarter statistics will be released in the new year. These figures will reflect the impact of the robo-signing fiasco.

Already dirt cheap, foreclosure prices dive

Will You Be Taking Advantage Of The Falling Prices Of Foreclosures?

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