Foreclosures drive sales up, at lower prices!

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Prices for existing homes in Lee County kept dropping and sales spiked in September as bank foreclosures rejuvenated the residential market, according to statistics released Friday.
There were 746 houses sold with the help of a Realtor in September, up 9 percent from 684 in August, according to a report issued by the Florida Association of Realtors.
Meanwhile, the median price dropped 4 percent to $141,400 in September from $146,900 in August. That’s 56 percent down from the all-time high of $322,300 in December 2005.
The picture was much the same around the country.
The National Association of Realtors said in a separate report Friday sales of existing homes rose by 5.5 percent in September compared with August, the best showing since a 5.6 percent increase in July 2003, during the five-year housing boom. The median sales price dropped to $191,600, down by 9 percent from a year ago.
In Lee County the trends are being driven by banks selling houses they’ve taken back in foreclosure, said real estate agent Steve Koffman of Century 21 Sunbelt Realty in Cape Coral.
“They’re very clearly not wanting to own and carry this inventory,” he said. “We’ve had them say recently, ‘Give us a price to sell in 30 days.’”
Some banks are even more aggressive about selling, Koffman said. “We had one recently say to a teammate, ‘We want to sell in two weeks for cash.’ We put it on the market Friday and we had 15 offers by Monday.”
The result has been sales by lenders are accounting for a larger share of the market, he said.
In September, for example, 38 percent of the single-family houses sold were foreclosures even though only 2,439 or 17 percent of 14,029 houses currently on the market are foreclosure properties.
Foreclosures have had little effect on condominiums because “90 percent of the foreclosures were for single-family homes,” said real estate agent Steve Luta of Market America Realty and Investments in Cape Coral. There were 153 condos sold in September, down 9 percent from 168 in August.
Nationally, inventories of unsold existing homes dropped by 1.6 percent in September to 4.27 million units which would be a 9.9 months supply at the September sales pace, still a historically high level.
Lawrence Yun, chief economist for the Realtors, said a sales turnaround first seen in California was beginning to broaden to other regions of the country including Colorado, Kansas, Minnesota, Missouri and Rhode Island.
In a further effort to bolster the housing market and deal with record high levels of mortgage defaults, Sheila Bair, the head of the Federal Deposit Insurance Corp., is pushing Treasury to include in the $700 billion rescue package for the financial system a new program to prevent more mortgage foreclosures.
Un4der Bair’s proposal, the government would provide guarantees for mortgages that have been reworked by banks to lower payment schedules to more affordable levels.
The rise in September sales pushed activity to a seasonally adjusted annual rate of 5.18 million units last month. Courtesy of Fort Myers News Press