Residential short selling is rising rapidly in some of the nation’s largest metropolitan areas. U.S. banks are finally approving more short sales to pre-emptively jettison sketchy mortgage loans off their troubled balance sheets — while avoiding the increasing cost and complications involved with selling bank-owned properties. This shift means bigger discounts and faster short sales transactions in some markets.
If you’re in the market today for a home, you’re almost guaranteed to be looking at distressed properties, including short sales. Nationwide, nearly one-third of all U.S. homes sold in the second quarter of 2011 were in some stage of foreclosure, with short sales accounting for 12 percent of all residential real estate sales, according to RealtyTrac data. A total of 102,407 short sales were sold to third party buyers from April to June 2011, up 19 percent from the 86,059 short sales sold in the first quarter of 2011.
And more are expected: In Nevada, 60 percent of the properties with a mortgage are worth at least 25 percent less than the outstanding mortgage, while 44 percent in Arizona and 46 percent in Florida are underwater, according to RealtyTrac. In Michigan, 58 percent of borrowers are underwater, while 27 percent of Californian borrowers are drowning in negative equity. As many of these underwater buyers decide to sell — or are forced to sell by some unfortunate circumstance — a short sale will be their primary option.
No comments:
Post a Comment