Foreclosure and short sales as a percentage of total home sales in the Charlotte, North Carolina region remained very low (0.3%) as of January 2022.
That's 50% lower than at the start of 2021!
If you've been searching for a distressed property "bargain" in the Greater Charlotte area and are having a hard time finding one, here's why:
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Foreclosure sales were down 63.2% in January 2022 versus January 2021. Charlotte region saw 7 foreclosure sales closed in January 2022 versus 19 in the same month one year ago.
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Short sales "technically" increased 100%, but that's because in January 2021 we had one short sale and in January 2022 we had two short sales.
Clearly, one reason it's hard to find that distressed property "bargain" is because there are simply fewer of these homes available for sale and sale prices for foreclosed and short sale homes continue to increase, as the charts below show.
As of February 2022, the inventory of foreclosure homes for sale on a 12-month rolling basis in the Charlotte region was 15 homes compared with 195 homes in the same month in 2017. The months supply of inventory of foreclosed homes was under one month at 0.8 months in February 2022, compared with the same time frame in 2017 when it was 2.3 months. Even five years ago, it was a seller's market when it came to distressed property sales.
As of February 2022, the average sale price of a foreclosed home on a 12-month rolling basis in the Charlotte region was just under $317,000, while the average short sale home prices was just under $365,000. And if you do manage to "score" a distressed property sale, you won't be seeing any discounts to the list price... on average, foreclosed homes sold at 101% of list price on average as of February 2022. This compares to 95.2% five years ago.
DON'T WAIT FOR A WAVE OF FORECLOSURES TO FIND THAT BARGAIN
If you've been waiting on a wave of foreclosures to "hit" the market in 2022, here are five reasons why that is not likely to happen:
- There are way fewer homeowners in trouble compared with the last housing crash, when there were some 9 million households in trouble.
- Currently, the number of mortgages still in forbearance is under 900,000. Those homeowners who remain in forbearance still have the chance to work out a suitable plan with the servicing company that represents their lender. And the servicing companies are under pressure to do just that by both federal and state agencies.
- Most homeowners have more than enough equity to sell their homes (unlike in the last housing crash). For those who can’t negotiate a solution and the 16.8% who left the forbearance program without a work-out, many will have enough equity to sell their homes and leave the closing with cash instead of facing foreclosures.
- The forbearance program in the past two years provided homeowners an extra two years to get their finances in order and work out a plan with their lender. That prevented over 400,000 foreclosures that normally would have come to the market had the new forbearance program not been available.
- When foreclosures hit the market in 2008, they added to an oversupply of houses already for sale, resulting in a 9+ month supply of listings. Anything over a six-month supply can cause prices to depreciate. The current inventory shortage of homes nationwide (and in the Charlotte region) means the market could easily absorb one million new homes without any impact on pricing.
Want to stay on top of foreclosure and short sale home listings in the Greater Charlotte area?
Contact Nina Hollander with Coldwell Banker Realty and we'll send you a list of homes as they come on the market.
SEARCH ALL CHARLOTTE REGION HOMES FOR SALE
This Charlotte region housing market update on distressed property sales trends is provided by Nina Hollander/Carolinas Realty Partners with Coldwell Banker Realty, Greater Charlotte residential real estate experts serving Charlotte region home buyers and sellers for 20+ years.
If you're considering selling or purchasing a home in the Greater Charlotte region, I'd love an opportunity to earn your business, to exceed your expectations, and to show you why experience matters and how:
"The Right Broker Makes All The Difference"
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