The share of bank-owned homes and homes in some stage of foreclosure dropped 5 percent from the first quarter to the second quarter, falling from 36 percent to 31 percent, but was up from 24 percent in second-quarter 2010, according to a report released today by foreclosure data provider RealtyTrac.

And distressed properties are selling at a larger discount these days, RealtyTrac reported:

  • The average sales price of a bank-owned (also known as real estate owned or REO) home was $145,211 in the second quarter, which was about 40 percent below the average sales price of a nonforeclosure home. That compares with a 36 percent discount in first-quarter 2011 and a 34 percent discount in second-quarter 2010.
  • The average sales price of a preforeclosure home (preforeclosures, which are homes in default or scheduled for sale at public auction, are often sold in a short-sale process) was $192,129 in the second quarter, which is 21 percent below the average sales price of a nonforeclosure home. That compares with a 17 percent discount in first-quarter 2011 and a 14 percent discount in second-quarter 2010.

There were 162,680 sales of bank-owned homes to third parties in the second quarter, RealtyTrac also reported, roughly flat compared with the 162,900 reported in the first quarter and down 10 percent from second-quarter 2010. REO sales accounted for 19 percent of home sales in the second quarter, compared with 23 percent in the first quarter and 15 percent in second-quarter 2010.

The share of bank-owned homes and homes in some stage of foreclosure dropped 5 percent from the first quarter to the second quarter, falling from 36 percent to 31 percent, but was up from 24 percent in second-quarter 2010, according to a report released today by foreclosure data provider RealtyTrac.

And distressed properties are selling at a larger discount these days, RealtyTrac reported:

  • The average sales price of a bank-owned (also known as real estate owned or REO) home was $145,211 in the second quarter, which was about 40 percent below the average sales price of a nonforeclosure home. That compares with a 36 percent discount in first-quarter 2011 and a 34 percent discount in second-quarter 2010.
  • The average sales price of a preforeclosure home (preforeclosures, which are homes in default or scheduled for sale at public auction, are often sold in a short-sale process) was $192,129 in the second quarter, which is 21 percent below the average sales price of a nonforeclosure home. That compares with a 17 percent discount in first-quarter 2011 and a 14 percent discount in second-quarter 2010.

There were 162,680 sales of bank-owned homes to third parties in the second quarter, RealtyTrac also reported, roughly flat compared with the 162,900 reported in the first quarter and down 10 percent from second-quarter 2010. REO sales accounted for 19 percent of home sales in the second quarter, compared with 23 percent in the first quarter and 15 percent in second-quarter 2010.

There were 102,407 sales of preforeclosure homes to third parties in the second quarter of this year, up 19 percent from the first quarter but down 12 percent compared to second-quarter 2010. These sales accounted for 12 percent of sales in the second quarter of this year, flat with the first quarter and up 10 percent compared to second-quarter 2010.

"The jump in preforeclosure sales volume, coupled with bigger discounts on preforeclosures and a shorter average time to sell preforeclosures, all point to a housing market that is starting to focus on more efficiently clearing distressed inventory through more streamlined short sales — at least in some areas," said James Saccacio, RealtyTrac CEO, in a statement.

"This gives distressed homeowners who do not qualify for loan modification or refinancing — or who are not interested in those options and want to sell — a better chance of completing a short sale to avoid foreclosure." Expedited short sales, he added, "also give lenders the opportunity to more pre-emptively purge nonperforming loans from their portfolios," and avoid a lengthy foreclosure and REO process.

Among those metro areas with at least 100 foreclosure-related sales in the second quarter, Louisville, Ky., had the largest average foreclosure discount — 54 percent below the average sales price of nonforeclosure homes. Florida’s Sebastian-Vero Beach metro area was second on the list with an average foreclosure discount of 53 percent, followed by Milwaukee (51 percent), Pittsburgh (51 percent), and Kalamazoo, Mich. (50 percent), RealtyTrac reported.

Top 10 States with Largest Volume of Foreclosure Sales in Q2 2011

California 69,897
Florida 34,558
Arizona 25,756
Nevada 15,685
Michigan 11,668
Texas 11,517
Georgia 10,485
Illinois 9,355
Colorado 8,044
Ohio 6,868

Top 10 States with Largest Share of Foreclosure Sales in Q2 2011 (as a percentage of total sales)

Nevada 65.43%
Arizona 56.64%
California 51.31%
Michigan 40.61%
Georgia 38.42%
Colorado 35.90%
Florida 35.06%
Illinois 34.01%
Oregon 33.41%
Idaho 29.59%
Utah 26.85%

Top 10 States with Highest Average REO Discount

New Jersey 53.53%
New York 52.99%
Kentucky 51.58%
Illinois 49.89%
California 49.64%
Ohio 49.04%
Maryland 48.48%
Wisconsin 46.69%
Michigan 45.95%
Virginia 45.38%

Top 10 States with Highest Average Preforeclosure Discount

Missouri 43.19%
Tennessee 39.24%
Mississippi 39.22%
Indiana 36.93%
Maryland 36.11%
California 35.95%
Texas 35.03%
Delaware 33.84%
Georgia 33.03%
Kentucky 32.76%

9 States with Rise in Share of Foreclosure Sales (Q2 2010-Q2 2011)

Wyoming 96.63%
Nevada 30.71%
Montana 25.59%
Delaware 24.93%
Washington 22.61%
Iowa 21.13%
Arizona 16.07%
Colorado 5.23%
Hawaii 4.21%

Top 10 States with Largest Decline in Share of Foreclosure Sales (Q2 2010-Q2 2011)

New Hampshire -50.38%
Indiana -48.76%
Maine -47.40%
New Jersey -46.42%
New York -42.65%
Nebraska -42.33%
Mississippi -41.76%
Utah -34.79%
North Carolina -32.11%
Kentucky -30.82%

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