I just got done reading an article from CNN money magazine talking about foreclosure sales. Are they a good deal. Apparently so. One third of all sales in the first three months of 2010 were homes that were foreclosures or short sales.
What was even more dramatic was the price difference people paid for these homes. They bought them for an average of 27% less than a comparable home in the same area.
Now, foreclosed homes commanded a substantial difference in price in part to the fact that the previous homeowners were unable or unwilling to maintain the home when they knew the bank was going to take it over.
This has put a huge burden on existing home sales in the market today and helped keep prices at lower levels than anticipated. What has made it even more troublesome is the influx of inventory that is out there right now and the anticipated flood of homes going into foreclosure after the moratorium from the end of last year.
So people looking for good deals out there right now can still find them in a foreclosure. Banks are stuck right now with an influx of inventory and have held off putting homes on the market out of fear of driving prices down even farther. But what are they going to do as the inventory piles up? That answer can have a tell tale sign on what the market will do in terms of recovery and home prices for years to come.
Dave dicecco
Realtor/Broker
www.davedicecco.com
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