As part of my real estate practice, I regularly track market changes for all of the cities in our Solano County market area, including Vacaville. Presently, 82 out of 289 active listing in Vacaville are REO (bank-owned/foreclosure) listings. Another 84 are short sales. So 166 (or 57% of the total inventory) are distress sales of one sort of another.
Since last fall, I've published a "Distressed Property Report" on our web site ( http://homesection.com/category/market-update/
) that looks at the number of distress-sale listings vs. fair-market listings for each community in Solano and Central/East Contra Costa counties.
In my most recent report (late February -- see link below), 65% of the active listings in Vacaville were distress sales, including 116 REOs and 111 short sales. So if you compare the current figures, you can see that the number of distress sales has decreased in recent weeks.
I also track the listings inventory on a weekly basis and this week's report shows that Vacaville's total inventory has dropped by 27.6% since the beginning of the year (there were 416 active listings on Jan. 5; now there are 301). Real estate sales activity has always been heavily impacted by supply and demand principles. With interest rates low and the $8,000 first-time-buyer tax credit, many investors and first-time buyers have entered the marketplace in recent weeks, which has increased demand. Couple that with the decreased supply and it's no surprise that the market has heated up -- particularly in the $300,000-and-below price range
I will be publishing a new distress-sale report in the next week or so, which will let us see whether what's happened in Vacaville is consistent with what's occurred in the other communities in our market area since late February. I'm sure the total number of distress sales will be lower across the board, but it remains to be seen whether the percentage of distress-sale listings compared to fair-market listings has also decreased, as it has in Vacaville.
The big unknown is whether this trend will continue. Most of the foreclosure moratoria has now ended. However, legislators in Washington and Sacramento have been putting a lot of pressure on the major lenders to stem the flow of foreclosures. As I wrote in a recent post on our HomeSection.com web site, borrowers in our area likely won't get much help from the president's housing plan. However, lenders seem to have gotten the message to make foreclosure a last-resort. Accordingly, lenders seem to be becoming a little more cooperative with short sales, which up until now has been the ugly step-sister in the distress-sale arena.
I have heard that there may be a new "wave" of foreclosures, now that the foreclosure moratoria have ended. But whether that's a little ripple or a tidal wave remains to be seen. I've heard reports suggesting that there could be a flood of new listings in the most heavily impacted parts of our county. But I've also heard reports that this projected "flood" has been highly exaggerated.
If we are to see a new wave of foreclosures, I would expect that we should start seeing a surge of REO listings on our MLS in the next 4-6 weeks. As I see any developing trends, I'll be posting them on our web site, so be sure to check back regularly (or subscribe). Or contact us directly if you'd like more detailed information -- either via our Trulia profile or at http://homesection.com/contact/
Hope this information is helpful!
- Rod Herman