It seems that every day now, we see more and more properties for sale that are listed as REO (Bank Owned Foreclosures), and/or Short Sales.
Our team, has always run numbers as a means to better understand our markets. We researched the EBRD multiple listings service, following a conversation that we had last night. We were not surprised as to which cities had a higher percentage of REOs.
However, we did not expect the number for the entire San Francisco East Bay area to be this high, 21%. That means that roughly one in five houses that are for sale, are Bank Owned in the East Bay area. The interesting factor is that this number does not include “Short Sales.”
When lenders allow a home to be sold for less than the amount still owing on the mortgage loan, that’s called a pre-closure “Short Sale!”
I think you can see where this is going once you add “short sales” into the mix as well. The competition for many houses for sale in the market are from banks.
Here’s our spreadsheet tracking cities in the San Francisco East Bay Area for Months Supply and REOs. Months supply is the ratio of inventory to sales. It tells us how many months the stock of homes for sale would last, if sales continued at their current rate.
2008-01-16 Glen’s Numbers & Months Supply
For those living in other parts of the country, we’d love to hear what’s happening in your market. We’ve already heard from one Las Vegas agent, that 20.8% of their listings are REOs or short sales.
