Almost one in five Connecticut home sales in July 2015 were distressed properties.
That places the state fourth in the nation behind Florida, Maryland and Michigan.
According to the latest information from CoreLogic, a provider of consumer, financial and property information, analytics and services to business and government, distressed sales, which include real estate-owned properties (REOs) and short sales, accounted for 9.4 percent of total home sales nationally in July 2015, the company said. That’s down 2.1 percentage points from July 2014 and down 0.4 percentage points from June 2015.
Within the distressed category, REO sales accounted for 6.1 percent and short sales made up 3.3 percent of total home sales in July 2015 nationally. The REO sales share was the lowest since September 2007 when it was 5.2 percent. The short sales share fell below 4 percent in mid-2014 and has remained in the 3-4 percent range since then. At its peak in January 2009, distressed sales totaled 32.4 percent of all sales, with REO sales representing 27.9 percent of that share.
CoreLogic says the ongoing shift away from REO sales is a driver of improving home prices since bank-owned properties typically sell at a larger discount than short sales. The company says there will always be some level of distress in the housing market, and by comparison, the pre-crisis share of distressed sales was traditionally about 2 percent. If the current year-over-year decrease in the distressed sales share continues, it would reach that “normal” 2-percent mark in mid-2019.
Florida had the largest share of distressed sales of any state at 20.7 percent in July 2015, followed by Maryland (20.6 percent), Michigan (20.2 percent), Connecticut (19.1 percent) and Illinois (18.9 percent). Nevada had a 6.4 percentage point drop in its distressed sales share from a year earlier, the largest decline of any state. Only North Dakota and the District of Columbia are close to their pre-crisis numbers (within one percentage point).
