Bank-Owned Sales Drop Below 20% in SW King County

Bank-Owned Sales Drop Below 20% in SW King County

Here’s one more chart on the share of sales that were bank-owned homes. This one shows the share of sales that were bank-owned broken down by the NWMLS-defined regions.

In this chart I’ve grouped zip codes into their approximate NWMLS regions, which break South County into SE King and SW King and display Seattle and N King separately.

Bank-Owned: Share of Total Sales - King County Single-Family

Southwest King County is still much more distressed than the other regions, but steep declines in the last two months have dropped its share of bank-owned sales from 28% in February to just 19% in April. Seattle and the Eastside have decreased as well, and now sit at just 2.4% and 3.3% respectively.

After shooting up from 1.4% in December to 11.9% in March, bank-owned sales fell to 9.0% of the total in North King County in April.

Overall, the effects of distressed inventory and sales are mostly behind us in the Seattle area, save for Southwest King County, which still seems to have a bit to work through this year.

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

13 comments:

  1. 1

    S-Crow Said It for Me

    The current $85B/mo welfare [buying our own treasuries][ to home refinancing at today’s low middle income wefare mortgage rates is allowing folks to keep their homes through refinancing.

    I’d add the federal budget can’t afford this $1T welfare handout much longer before the country’s bankrupt.

    IMO, mortgage interest rates should be about 10% in a free market again…..meaning home prices need a 70% butcher ax too. Sooner or not much later from now.

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  2. 2

    IMO one of the many reasons why we have fewer REOs…currently…is due to the increased regulatory rules surrounding the foreclosure process at the state and federal level, along with the legal settlements and individual lawsuits, let alone all the sloppy loan servicing done early on in the meltdown that now must end. Loan servicers are having to toe the line/come into compliance w/all these new rules. From today’s news…I posted this in the open forum but I’ll drop it here too:

    “…Within two weeks of the release of the guidance, Wells Fargo, Citi and JPMorgan Chase (JPM) all but stopped foreclosure sales, which are usually the point of no return in the foreclosure process. JPMorgan has since resumed its normal volume.

    The halt is most dramatic with Wells, the nation’s largest mortgage originator. The bank’s foreclosure sales in five Western states — California, Nevada, Arizona, Oregon and Washington…”

    http://www.americanbanker.com/issues/178_96/wells-citi-halt-most-foreclosure-sales-as-occ-ratchets-up-scrutiny-1059224-1.html

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  3. 3
    Scotsman says:

    Nah, it’s Obama and his team- they have this country moving forward again. Prosperity is just around the corner . . .

    Rate this comment: Thumb up 0

  4. 4
    Erik says:

    RE: Jillayne Schlicke @ 2
    Interesting. Lets sell and pick up a cheap foreclosure after the banks build up too much inventory and begin slashing prices.

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  5. 5
    RandomThought says:

    Bank-owned sales have certainly dropped; however, this is not an indication of number of houses owned by the banks. There are many houses in my North Seattle neighborhood that have been abandoned and are vacant for over a year. It’s only recently that banks have posted signs on doors and sent people to clean them up. I think many more homes are going to be added to the inventory soon; this will slow down the present rat race. I also think rules (and perhaps legislation) to monitor real estate agents who are forcing buyers to give up their rights in present market conditions are in order. Bad behavior has consequences.

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  6. 6
    ARDELL says:

    RE: RandomThought @ 5

    Can you elaborate on why you think agents are “forcing” buyers to give up their “rights”? What rights? Are they “legal rights”?

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  7. 7
    RandomThought says:

    RE: ARDELL @ 6 – Technically, they are not “legal rights” *yet*. But, when listing agents encourage buyers to waive inspection, mortgage, and appraisal contingencies in offers, they are in fact asking buyers to forgo rights that protect buyers. I really hope that these listing agents (predominantly from large real estate firms such as Windermere, Coldwell Banker, and John L Scott) are encouraged by National Association of Realtors or some organization, or even regulated if necessary so that they do not remove the safety net for buyers. FYI, the bankers did not do anything that was legally wrong that led to the bubble and the subsequent disaster. Everything (and every “right”) cannot be enforced legally; there will always be loop holes and ways to skirt a “legal right” by unscrupulous schmucks. The important question is – are you one of those people?

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  8. 8
    ARDELL says:

    RE: RandomThought @ 7

    That’s a big topic RT. Let’s break that down:

    “But, when listing agents encourage buyers to…”

    The “Listing Agent” is the agent for the seller. It is a “listing agent” duty to always lean in the direction of what is in the best interests of the seller. That is why the seller provides a substantial sum of money for the buyer to buy a buyer’s agent with. Often the amount the seller sets aside for buyer representation exceeds the amount he is paying his Listing Agent for his own representation. It is not reasonable to expect the agent that the seller hired to represent the seller’s best interest, to also represent the buyer’s best interests.

    “The important question is – are you one of those people?”

    Am I one of “those people” who only represents the seller’s best interest if and when a seller of a home hires me to do so? I would have to answer yes to that. I also make it clear to buyers who call me direct (as recently as yesterday) that they need to hire their own agent with the money set aside to that purpose, if and when they call me direct on one of my listings.

    “waive inspection”

    This is an area that is often misinterpreted. Every buyer of every home should have the right to do an inspection. Should they have a right to cancel if the aggregate cost to repair all discovered items is nominal…let’s say within 1/4 of 1% of the price of the home or less? Having the right to DO an inspection, and having the right to cancel because they now don’t want the house really at all for reasons having nothing to do with the home inspection, is the question.

    Once buyers started using the inspection contingency to tie up a house while they decided if they really wanted the house or not, vs for its intended purpose, things went a bit haywire in the “rights” department. Does the seller have the right to assume that a buyer who makes an offer on his house is not doing so simply to have a week or so to decide if they really want the house or not? Using the home inspection contingency as a blanket legal out clause is not a “right” for the buyer at the expense of a seller who has an equally balanced “right” to expect that the buyer is acting in good faith when making an offer on his home.

    “”The important question is – are you one of those people?”

    Would I “force” a buyer of a home to waive the home inspection clause as the “listing agent” of the home? Of course not. In fact I would avoid speaking with buyers about most anything about their offer when I am the “listing agent” who represents the seller of the home. I would say the seller has set aside many THOUSANDS of dollars for you to go get the advice of your own agent for the buyer. Go buy an agent with that and ask YOUR agent what you should or should not do in your offer.

    “mortgage, and appraisal contingencies in offers”

    In 23 years I have never had a buyer need to invoke either of those clauses. Does the seller have the “right” to expect that any buyer making an offer on his home already knows that he has the wherewithal to actually BUY it? “Rights” are a two-way street, and while I can’t think of an instance in 23 years where I have “forced” a buyer to remove their finance contingency, either as the Agent for the Seller OR as the Agent for the Buyer, neither have I ever needed to rely on those contingencies as a means to an end.

    “they are in fact asking buyers to forgo rights that protect buyers.”

    Has a Listing Agent (Agent for the Seller) told me (as the Agent for the Buyer) that there is a buyer in the room who has waived these “rights” in their offer, and so it may be necessary “in order to compete” with that existing offer on the table for my buyer client to do the same? Yes. That is a NOTICE of final and best. It is a heads up to do a PRE inspection OR reserve the right to DO an inspection, but possibly waive the “right” to cancel for no really good reason. It is a NOTICE for the buyer to be 99% sure they can actually perform on that contract as to their ability to finance that purchase before stepping into the ring. It is a NOTICE that the house is likely to sell for more than a lender may lend on it, and the buyer may need to understand that in advance of making an offer.

    So the BIGGER “important question” is are YOU one of those buyers who wants to pocket the many thousands of dollars the seller has set aside for you to go buy an agent with, who represents YOUR best interests vs the seller’s best interest, vs hiring an agent to give you wise counsel with that money? Why would you ever expect the person who the seller hired to represent the seller’s best interest, the “listing agent”, to also represent your best interests as the buyer of the home?

    If you did not spend the money the seller set aside for you to hire a Buyer’s Agent with wisely. If you did not hire an agent to represent your best interests with those many thousands of dollars the seller set aside to that purpose, how is that the “listing agent’s” fault? If there is a buyer in the room with an offer on the table with NO contingencies, that is simply a fact that the listing agent is conveying…or not. The Listing Agent didn’t “force” that to happen. It just is what it is.

    The house will sell for “what the market will bear”. If there is a buyer in the room who is bidding higher than the house can appraise for, with NO contingencies, then that buyer is establishing the market conditions for that particular house, not the “listing agent”.

    When I am the listing agent I represent the best interest of the seller, while at the same time trying to be honest and fair to all parties, including the buyer with no contingencies and the highest offer on the table. When I am the agent for the buyer only, vs the seller, I give wise counsel based on that buyer client’s objectives and ability to act.

    And while you may think that ALL buyers have the same needs, and so those needs should become “legal rights”, that is clearly not the case.

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  9. 9
    Carl says:

    RE: RandomThought @ 7 – Caveat emptor. No seller forces a buyer to waive any rights. Buyers do that willingly. It’s called capitalism. Ardell is spot on – the listing agent works for the seller. It’s up to the buyer to decide whether to proceed or not.

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  10. 10
    David Losh says:

    RE: ARDELL @ 8

    As much as I want to disagree with what you are saying, I can’t because it’s true.

    People hire bad agents every day.

    The listing agent is asking for as much as they can get, but the buyer’s agent needs to be skilled to get the best possible deal.

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  11. 11
    whatsmyname says:

    RE: ARDELL @ 8 – A very thoughtful and informed response. The three thumbs down says more about the intellectual capacity of some of the posters here than anything I could say – but you can see that I couldn’t help but try.

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  12. 12
    RandomThought says:

    RE: ARDELL @ 8 – Very eloquent and candid response, Ardell! I respect and admire your viewpoint. You are certainly capable of representing the best interests of a seller; I wonder why any buyer in his or her sane state of mind would ever have you as an agent ;-) (just pulling your leg). On a serious but slightly divergent note, I completely support free market and capitalism contrary to what most readers here might infer. However, allow me to give you a few examples to help you understand where I am coming from: you have the “right” to smoke and I have the “right” not to inhale second-hand smoke. You may have the “right” to bear arms and I have the “right” to be safe and not be shot dead by a maniac brought up in a dysfunctional household. You may support “right” to uphold the traditional definition of marriage and I support the “right” for two people in a loving partnership to be treated the same, irrespective of their genders. Should we apply the basic tenets of capitalism to sort out all these issues by supporting the best interests of the side that brings the most money to the table?

    By the way, Ardell, the term “you” in my comment is rhetorical and does not address you specifically. You seem to be too rational and well informed to be insular and unscrupulous.

    I have digressed enough! This will be the end of my rant. :-)

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  13. 13
    RandomThought says:

    RE: ARDELL @ 8 – Very eloquent and candid response, Ardell! I respect and admire your viewpoint. You are certainly capable of representing the best interests of a seller; I wonder why any buyer in his or her sane state of mind would ever have you as an agent ;-) (just pulling your leg).

    On a serious but slightly divergent note, I completely support free market and capitalism contrary to what most readers here might infer. However, allow me to give you a few examples to help you understand where I am coming from: you have the “right” to smoke and I have the “right” not to inhale second-hand smoke. You may have the “right” to bear arms and I have the “right” to be safe and not be shot dead by a maniac brought up in a dysfunctional household. You may support “right” to uphold the traditional definition of marriage and I support the “right” for two people in a loving partnership to be treated the same, irrespective of their genders. Should we apply the basic tenets of capitalism to sort out all these issues by supporting the best interests of the side that brings the most money to the table?

    By the way, Ardell, the term “you” in my comment is rhetorical and does not address you specifically. You seem to be too rational and well informed to be insular and unscrupulous.

    I have digressed enough! This will be the end of my rant. :-)

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