Report: Home Sellers See 17% Average Gain from Purchase Price

RealtyTrac, Irvine, Calif., reported homeowners who sold during the third quarter saw and average price gain of $40,658, or 17 percent, from their purchase price, the highest gain since 2007.  

The company’s Q3 2015 U.S. Home Sales Report also said home sellers in the third quarter on average had owned their home for 6.72 years when they sold.  

The report noted the eight-year high in average price gains for home sellers came despite slowing home price appreciation. The average sale price of single family homes and condos nationwide during the quarter rose to $263,976, up 0.2 percent from the previous quarter and up 2.4 percent from a year ago, the slowest year-over-year price appreciation in any quarter since home prices bottomed out in first quarter 2012.  

RealtyTrac reported 2.487 million existing single family and condo sales through the first three quarters of 2015, the highest level for the first nine months of a year.   

“An increasing number of homeowners in 2015 have been cashing out the home equity they’ve gained during the housing recovery of the past three years,” said Daren Blomquist, vice president with RealtyTrac. “That may be a good decision because the data points to a plateauing market going forward. Home price appreciation is slowing, a trend that will continue if interest rates rise in the coming months as expected. Meanwhile the threat of rising interest rates combined with lowered premiums for buyers using FHA loans is spurring more demand.”  

The report said buyers using FHA loans accounted for 23.4 percent of all single-family home and condo sales with financing, excluding all-cash sales, in the third quarter, up from 23.2 percent in the second quarter and up from 17.9 percent a year ago. Major metro areas with the highest share of FHA loans in the third quarter included Bakersfield, Calif. (41.3 percent), Modesto, Calif. (40.4 percent), McAllen, Texas (39.7 percent), Las Vegas (37.1 percent), Riverside, Calif. (37 percent) and Dayton, Ohio (29 percent).  

RealtyTrac said in 20 counties, home sellers on average in the third quarter sold for a lower price than what they purchased, including Pasco County (Tampa), Fla. (-11.1 percent), Hamilton County, Ohio (Cincinnati), -9.4 percent; and McHenry County, Ill. (-9.0 percent). Counties where sellers on average sold for the biggest percentage gain in the third quarter were San Francisco County (58.7 percent gain), San Mateo County, Calif. (55.7 percent gain), Santa Clara County, Calif. (47.7 percent gain), Alameda County, Calif. (43.1 percent gain), and New York County (Manhattan), (41.6 percent gain).  

RealtyTrac analyzed 135 counties nationwide with at least 1,000 sales with home price data available in the third quarter and found that 55 of those counties (41 percent) posted a year-over-year decrease in average home prices in the third quarter.  

The report also noted 245,220 all-cash sales of single-family homes and condos in the third quarter, representing 27.8 percent of all single-family home and condo sales during the quarter. This was down from 28.7 percent of all sales in the previous quarter and down from 29.0 percent of all sales a year ago.  

The report said 72,218 single-family homes and condos sold in the third quarter while actively in the foreclosure process, representing 8.1 percent of all sales. That was down from 8.2 percent in the previous quarter and down from 9.2 percent a year ago. It also reported 72,245 bank-owned single family homes and condos sold, 8.1 percent of all sales. That was down from 9.2 percent in the previous quarter and down from 10.8 percent a year ago to the lowest level since the third quarter of 2007 when it was at 8.0 percent.