Third-quarter Foreclosure Sales Increase

RealtyTrac has released its Q3 2012 U.S. Foreclosure & Short Sales Report, which shows a total of 193,059 U.S. properties in some stage of foreclosure or bank-owned (REO) were sold during the third quarter, an increase of 21 percent from the previous quarter, but still down 3 percent from the third quarter of 2011.

The report also shows that foreclosure-related sales accounted for 19 percent of all U.S. residential sales during the third quarter — down from 20 percent in the previous quarter but the same level as in the third quarter of 2011.

Counter to the trend in recent years, sales of properties in some stage of foreclosure (pre-foreclosure sales) outnumbered sales of foreclosed, bank-owned properties in the third quarter. A total of 98,125 pre-foreclosure sales occurred during the quarter compared to a total of 94,934 REO sales.

Other high-level findings from the report:

• Pre-foreclosure sales increased 22 percent from the previous quarter and were also up 22 percent from the third quarter of 2011, while the average sales price decreased 3 percent from the previous quarter and was down 5 percent from a year ago.
• REO sales increased 19 percent from the previous quarter but were still down 20 percent from the third quarter of 2011. The average REO sales price decreased 7 percent from the previous quarter but was still up 7 percent from the third quarter of 2011.
• Homes in foreclosure or bank owned sold at an average price that was 32 percent below the average price of a home not in foreclosure, up from a 29 percent discount in the second quarter and a 31 percent discount in the third quarter of 2011.
• Short sales of properties not in the foreclosure process increased 15 percent from the previous quarter and were up 17 percent from the third quarter of 2011. These non-foreclosure short sales accounted for an estimated 22 percent of all residential sales, bringing the total distressed sale share to an estimated 41 percent for the quarter.
• Non-foreclosure short sales prices in the third quarter fell short of the total amount of loans outstanding by an average of $82,312 per short sale. For all short sales, including non-foreclosure and in-foreclosure properties, the sales price was short of combined loan amounts by average of $94,896 per short sale.