Distressed Sales Drop to 10-Year Low

ATTOM Data Solutions, Irvine, Calif., said distressed sales fell to 12.5 percent of all home sales in the third quarter, down from 13.5 percent the previous quarter and down by 14.1 percent from a year ago to its lowest level since 2007.

The company’s quarterly U.S. Home Sales Report also reported two-thirds of all U.S. housing markets have exceeded pre-recession home price peaks and that homeownership tenure reached a new high of 8.19 years.

“Distressed sales nationally are now the exception rather than the rule, and we would expect the distressed sale share to return to the pre-recession norm of single-digit percentages within the next year given the current downward trajectory,” said Daren Blomquist, senior vice president with ATTOM. “Distressed sales have become more localized in nature, with some of the biggest increases from a year ago in markets experiencing regional economic weakness or a natural disaster event that has triggered a jump in foreclosure activity.”

The report said among 146 metropolitan statistical areas with a population of at least 200,000 and at least 100 distressed sales during the quarter, those with the highest share of distressed sales were Atlantic City, N.J. (35.2 percent); McAllen-Edinburg, Texas (24.5 percent); Montgomery, Ala. (23.7 percent); Akron, Ohio (23.2 percent); and Youngstown, Ohio (22.5 percent). Metros with the smallest share of distressed sales were San Jose, Calif. (3.1 percent); Salt Lake City, Utah (3.3 percent); Austin, Texas (4.1 percent); San Francisco (5.2 percent); and Provo-Orem, Utah (5.5 percent).

ATTOM reported median sales prices exceed pre-recession peaks in 66 percent of local markets. The median sales price nationwide in the third quarter rose to $248,000, up 10 percent from a year ago to a new high, 3 percent above the pre-recession high of $241,900 in Q3 2005 and marking the second consecutive quarter where median home prices nationwide rose above the pre-recession peak. Median home prices increased to new highs in 55 of 126 metro areas analyzed for home price appreciation in the report (44 percent), including Los Angeles, Dallas, Atlanta, Detroit and Seattle.

Median home prices are still below pre-recession peaks in 43 of 126 metropolitan areas analyzed for home price appreciation in the report (34 percent), including New York (6 percent below); Chicago (10 percent below); Philadelphia (2 percent below); and Washington, D.C. (3 percent below).

The report said home sellers sold for $58,000 more than their original purchase price on average in the third quarter, a percent gain of 31 percent above original purchase price on average, the highest average dollar gain and percent gain since Q2 2007.

Among metro areas, highest average percent gain for home sellers were San Jose (80 percent); San Francisco (71 percent); Seattle (65 percent); Austin, Texas (59 percent); and Portland (58 percent).

The report also noted homeowners who sold in the third quarter had owned an average of 8.19 years, up from 7.97 years in the previous quarter and up from 7.77 years a year ago. Longest average homeownership tenure for homes sold were Springfield, Mass. (12.48 years); Worcester, Mass. (12.41 years); New Haven, Conn. (12.35 years); Boston (12.25 years); and Bridgeport, Conn. (12.24 years).