Monday, August 1, 2011

Buyers' Market: Distressed Properties vs. Traditional Listings

The discount alone appears to be enough to make distressed properties a better deal than more expensive traditional listings -- if it doesn't needs a lot of work, if you can out-bid the investor and if you've got time to make the deal pencil, among other "ifs."

by Broderick Perkins
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Deadline Newsroom - Distressed homes come with deeply discounted prices, but their prices continue to tumble. Homes sold the traditional way cost more, but prices are more stable.

CoreLogic's latest "U.S. Housing and Mortgage Trends" report, issued in late July says traditional home prices appear to be doing better than homes in the distressed sector and the trend is expected to continue.

CoreLogic reported its home price index of traditional home sales dropped only 0.4 percent from a year ago. Toss in distressed properties and the index was down 7.4 percent.

The report also says while the prices of traditional existing and new homes have returned to 2009 levels, prices for bank-owned foreclosures and short sale transactions -- distressed homes -- are 10 percent below 2009 levels and "continue to decline," CoreLogic reports.

So far this year, distressed sales nationwide accounted for one in three of all homes sales, 33 percent. In 30 major cities CoreLogic tracks, the price discount on distressed sales ranges from about 20 to 60 percent, or an average of about 40 percent.

The discount alone appears to be enough to make distressed properties a good deal.

But there's more to consider. Get the full story here: "What’s the Best Buy? Bargain or Full-Priced Real Estate?"

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Broderick Perkins, an award-winning consumer journalist, parlayed 30 years of old-school journalism into a digital real estate news service, the San Jose, CA-based DeadlineNews Group, including DeadlineNews.Com, a real estate news and consulting service and Web site, and the Deadline Newsroom, DeadlineNews.Com's news back shop.

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