Bank-owned properties account for less than half of existing home sales

By Buck Wargo

Published Tuesday, Feb. 23, 2010 | 9:57 a.m.

Updated Wednesday, Feb. 24, 2010 | 11 a.m.

Bank-owned properties accounted for fewer than half of the existing sales in January in what analysts said is a greater movement of lenders to approve short sales.

Of the 3,429 existing home sales in January, 47 percent were bank-owned, SalesTraq reported. For much of last year, bank-owned homes accounted for two-thirds of the market. The firm said 47 percent of homes on the Multiple Listing Service were listed as short sales.

“It appears to me that short sales are going to replace some of the foreclosure sales in year’s past because the banks realize that they lose less money on short sales than if they let it go to the foreclosure process,” said SalesTraq President Larry Murphy.

Under short sales, banks allow homeowners to sell the property for less than what they owe on the mortgage. Banks have been encouraged by the federal government to process more short sales because foreclosures can further depress housing prices.

SalesTraq reported 1,351 foreclosures in January, the fewest since April. That’s 43 percent fewer than January 2009 when there were 2,367 foreclosures.

Median prices remained stable in January at $120,000, the same as December. Home prices have only dipped below $120,000 once since the housing downturn started in 2006. That was $115,750 in August.

The 3,429 sales in January were the fewest since 2,801 in February 2009, but home sales typically are low in the first two months of the year because fewer people look for homes during the holidays.

January’s sales were 24 percent higher than January 2009.

In the new-home market, the 295 sales are the fewest since January 2009 when there were 271 sales. The median closing price was $201,515, a drop of about $6,000 from December. The average price per square foot was $101.36 in January, down about $4 per square foot from December.

CORRECTION: The story was updated to reflect updated and corrected data from SalesTraq. | (February 24, 2010)