With all the hype and talk about foreclosure/bank-owned and short-sale properties, especially in Loudoun County, you're probably wondering what that segment of the real estate market is up to. Let's look at the statistics to find out...
Supply/Inventory
- The number of foreclosure/bank-owned and short-sale properties that came on the market in July 2008 was 318. This is an 8 percent increase from June 2008 (318 versus 291).
- The number of foreclosure/bank-owned and short-sale properties that came on the market in July 2008 was 45 percent more than in July 2007 (218 versus 175). This statistic in itself does not look very good, but let's continue looking at buyer demand and then look at the overall picture.
- New foreclosure/bank-owned and short-sale listings comprised 47 percent of the total new listings in Loudoun County in July 2008
Demand
- The number of foreclosure/bank-owned and short-sale properties that went under contract (aka sold) in July 2008 was 299. This is a 12 percent increase from June 2008 (299 versus 263). This is a key statistic because July is usually slower than June when it comes to buyer activity and shows that buyer demand for these types of properties is up.
- The number of foreclosure/bank-owned and short-sale properties that sold in July 2008 was 440 percent higher than in July 2007 (299 versus 68). This shows a huge year over year improvement that has been the general trend in Loudoun County so far this year.
- Foreclosure/bank-owned and short-sale properties comprised 54 percent of the total number of homes sold in Loudoun County in July 2008
Although inventory is up, buyer demand for distressed properties has risen tremendously helping to absorb these new properties/listings and stabilize the market. For example:
- In July 2007, the ratio of new listings to buyer demand was 5:2 (for every 5 new listings, 2 went under contract/sold).
- In July 2008, the ratio was almost 1:1.
Although we haven't seen the flow of foreclosure/bank-owned and short-sale properties slow down, buyers and investors are out in full force buying them up. The fact that buyers and investors are out is great news for not only the distressed property market in Loudoun, but the overall Loudoun County real estate market.
In a nutshell, despite increased inventory, the distressed property segment of the market is showing improvement. It'll be even better once we see new inventory start to plateau and eventually go down while buyer demand stays strong. And if Loudoun County gets involved in buying up foreclosure/bank-owned properties like Fairfax County is going to do, that'll be even better.
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