We’ve followed the same four REO listing agents since 2007, looking for clues about the flow of REO inventories.  Here is a comparison of late-August numbers:

August 21, 2007 – 382 Actives/111 Pendings = 3.44

August 21, 2008 – 121 Actives/147 Pendings = 0.82

August 27, 2009 – 44 Actives/135 Pendings = 0.33

On foreclosureradar there are 4,274 bank-owned properties, for these REO specialists to only have 179 properties on the market today indicates a major blockage.

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Maybe they are just closing them quickly? Here are their year-to-date numbers, through 8/15:

Year # of SOLDS $$/sf DOM
2007
430
$299 65
2008
997
$216 81
2009
865
$165 66

They are closing fewer than last year?

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Maybe the moratoriums bogged them down, and they are rolling now? Here are their July’s stats:

Year # of SOLDS $$/sf DOM
7/07
78
$298 63
7/08
160
$201 74
7/09
81
$169 60

Even though the powers that be have choked off the flow of REOs, it doesn’t seem to have stopped REO pricing from plummeting 44% in the last two years.

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August is almost over, has there at least been an overall increase in REOs listed this month, compared to July, 2009?

Month Total New REO Listings
7/09
1,022
8/09
677

True, this month isn’t over, but even with a three day blitz we’re not going to come close to last month’s new REO listings.

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The 8,000 lb. gorilla in the room are the 20,672 defaulted properties in San Diego County. Can they get a loan modification or short sale completed, or are they destined for the court house steps too?

The servicers are getting aggressive about closing short sales quicker. One in process got an unexpected incentive yesterday – if we can close by the end of September we get a 7% commission, instead of 6%. But it’s not the taxpayers taking the hit, it’s the private mortgage insurance company.

Another month gone by, and what do we have? Servicers racking up more fees, deadbeats enjoying more free rent, and buyers waiting anxiously to steal one from the bank. We need an REO enema!

author avatar
Jim the Realtor
Jim is a long-time local realtor who comments daily here on his blog, bubbleinfo.com which began in September, 2005. Stick around!

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