A new report today from Campbell/Inside Mortgage Financeshows distressed sales, that is bank-owned properties (REO's) and short sales, where the home is sold for less than the value of the mortgage, made up 47 percent of all home sales in December. That's up from 44.5 percent in November.
The National Association of Realtors put out a lower percentage last week (36 percent), but after speaking with the number crunchers at Campbell, I'm thinking the higher share is more accurate. We also just got numbers from DataQuick out West, showing 38 percent of California sales in December were REOs, and that doesn't include short sales, so you see the evidence.
Where am I going with this? After talking with Thomas Popik over at Campbell, I was struck by how much the sales volume in December was skewed by this surge in distressed sales. The normal seasonal pattern should have home sales flat between November and December, but that certainly wasn't the case, with sales up 12.3 percent seasonally adjusted and up nearly 14 percent not seasonally adjusted, according to the National Association of Realtors.