Foreclosures Are Up, but Bargains Hard to Find

Selling prices for problem homes are tracking closely to market.
By: Lori Weisberg: REALTOR® Magazine Online
Real estate professionals specializing in foreclosures in California and elsewhere say business is brisk, but nowhere near what it was during the housing downturn in the 1990s. And bargains are hard to find.

During the second quarter of this year, foreclosures were nearly 10 percent of all resales, compared with just 1.7 percent a year earlier. But that's still off the peak of nearly 15 percent seen twice during the mid-1990s, according to DataQuick Information Services, which has been tracking real estate transactions since 1988.

DataQuick's analysis of recent sales found no pattern of foreclosure properties regularly selling for less than comparable homes.

"There may be some deals out there, but I'm not sure they're as many or as good as the perception," DataQuick analyst John Karevoll says.

A year ago, there was a much higher percentage of distressed properties selling at significant discounts, says Christopher Cagan, director of research and analytics for First American CoreLogic, a real estate information company. But things have changed as foreclosures have increased. “In general, the discounts right now are modest,” he says.