Report predicts increased distressed sales

Short sales and foreclosure auctions will continue to offer affordable buying opportunities for relocating families this fall.

In its first bi-monthly U.S. Housing and Market Trends report, research firm CoreLogic reported that many consumers will continue to rely on distressed property sales as a way to afford moving into a new home. These type of property sales waned slightly in the summer months after the expiration of the federal homebuyer tax credit removed some buyer incentive.

During the month of June, just 24 percent of all home sales activity came from distressed sales, down from the peak of 35 percent reached in early 2009. That was because many buyers relied on the tax credits to help them afford moving into non-distressed properties, said the report. But with the incentive gone and negative equity rising, CoreLogic predicts that distressed sales will regain their spot the property of choice among relocating families this fall.

CoreLogic also pointed out that people moving to Las Vegas were most likely purchasing a distressed property, as 61 percent of home sales there were either REO or short sale transactions. in Riverside, California, 59 percent of all home sales were distressed properties.

More distressed properties might soon hit the market, increasing the nation's foreclosure inventory. According to RealtyTrac, a record-high 95,384 homes were repossessed by lenders during August.
 

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