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New data released Thursday indicates Ohio and the Cincinnati market is still working through a backlog of foreclosure inventory on the books.
The number of U.S. homes sold in some stage of foreclosure declined 22 percent year-over-year from one in four properties a year ago, to one in five properties the first quarter of 2013, RealtyTrac Inc. said in a newly released report.
Fewer distressed homes sold nationwide last quarter, and the ones that were sold fetched higher prices on average, RealtyTrac said.
But not in Ohio as a whole or in the Cincinnati metropolitan area, which includes Butler County. Ohio bucked the nationwide trend found in RealtyTrac’s report. Cincinnati, Cleveland, Columbus and the entire state recorded a higher number of foreclosure-related sales in the first quarter at lower prices. Ohio was one of 12 states to see an increase in distressed sales year-over-year.
Dayton was the only major Ohio metropolitan to record fewer distressed home sales and higher sales prices in line with the nation.
“New foreclosure activity now I believe is translating into more foreclosures actually listed for sale and being sold in Ohio and that’s a trend that’s counter to the national trend where foreclosure activity is down and foreclosure sales are also down,” RealtyTrac spokesman Daren Blomquist said.”The root cause of all this Ohio’s just a little bit slower to dispose of these distressed properties than some other states because of the longer judicial process.”
During the first three months of this year, 1,661 Cincinnati metro area homes in the foreclosure process were sold for an average price of $77,432. In the first quarter of 2012, 1,399 area homes in some stage of foreclosure were sold for an average price of $83,590 the RealtyTrac figures show.
Foreclosure-related sales include properties that have received a default notice, been scheduled for auction or are bank-owned.
Butler County alone had 439 foreclosure related sales last quarter that sold for an average price of $90,733, also according to RealtyTrac. By comparison in the first quarter of 2012, Butler County had 347 distressed property sales for an average $88,182.
Distressed home sales comprised nearly 30 percent of all home sales in Butler County from January to March, according to RealtyTrac’s estimates. Irvine, Calif.-based RealtyTrac is a for-profit firm for foreclosure listings.
Distressed sales drag down home values and the more distressed homes that are sold, the more they drag down home values, Blomquist said.
“We’ve gotten through most of the toxic loans that triggered the foreclosure crisis in the first place,” Blomquist said. Many homeowners remain underwater, owing more on their mortgage than the property is worth, but “rising home prices are helping to rescue at-risk homeowners from foreclosure. They’re more likely to have equity, which gives them a lifeline to other options rather than just foreclosure, such as sale of a home or refinancing.”
The share of foreclosure sales on the market nationwide are still high above 20 percent. In a normal market, distressed properties represent less than 5 percent of all home sales, Blomquist said.
Hamilton real estate agent Brian Marischen said, “There are still foreclosures hitting the market without question. It’s not to the point that we saw three or four years ago.”
“You find that we’re doing a lot more short sales today for the simple fact that banks tend to be more agreeable with short sales than they were four, five years ago,” said Marischen, broker/owner of Hamilton firm Realty First. “If they’re priced well, investors are purchasing distressed properties. The problem is when these distressed properties aren’t priced well” causing the properties to linger and become eyesores.
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