Posted on Tuesday, February 23, 2010
Short sales accounted for a substantial 15.9 percent of home purchase transactions in January. This was well above the share of other distressed property activity – with damaged REO accounting for 13.4 percent of activity and move-in ready REO making up 13.8 percent. Borrowers that agree to a short sale escape the bad credit marks of a foreclosure and can often buy another house with mortgage financing after only two years. For borrowers going though the foreclosure process, mortgage financing can be unavailable for a period of five to seven years afterward. Short sale properties are most often purchased by first-time homebuyers, the January survey results revealed.
Sshort sales typically sell for 91 percent of the listing price. In contrast, move-in ready REO sells for 99 percent of listing price, on average. Phoenix, Arizona lawmakers are currently considering a bill that would mandate realtors there learn short sale strategies. NAR