Decline in REOs blamed for sagging California home sales | Mount Kisco NY Real Estate

The California Association of Realtors says inventory shortages dented pending home sales in June, as lenders signed off on more short sales but had fewer “real estate owned” properties, or REOs, to market.

CAR’s Pending Home Sales Index was down 3.8 percent from May to June, but at 121.4 was up 4.7 percent from a year ago. An index of 100 is equal to the average level of contract activity during 2008.

REO’s accounted for 20.2 percent of pending sales in June, down from 29.2 percent a year ago. Short sales were up, but only slightly, accounting for 21.4 percent of sales statewide, compared with 20 percent a year ago.

All told, distressed properties (short sales, REOs and others) accounted for 42 percent of pending sales, down from 49.5 percent a year ago.

“Pending sales declined in June, partly due to a lack of housing supply — especially in REO properties,” CAR President LeFrancis Arnold said in a statement.

“The shortage of REO inventory is also putting upward pressure on bank-owned home prices, with the median price of REO properties showing a double-digit year-over-year gain of 11 percent in June.”

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Share of distressed sales to total sales (single-family homes)

Type of Sale	June 2011	May 2012	June 2012
Equity Sales	50.5%	56.0%	58.0%
Total Distressed Sales	49.5%	44.0%	42.0%
REOs	29.2%	22.6%	20.2%
Short Sales	20.0%	21.1%	21.4%
Other Distressed Sales (Not Specified)	0.2%	0.3%	0.4%
All Sales	100.0%	100.0%	100.0%

Source: California Association of Realtors

There was considerable variation at the county level, with distressed properties accounting for a low of 20 percent of pending sales in affluent Marin County, compared with a high of 63 percent in Lake, San Benito and Solano counties.

Single-family distressed home sales by county (percent of total sales)

County	June 2011	May 2012	June 2012
Amador	51%	50%	55%
Butte	34%	37%	36%
El Dorado	54%	47%	44%
Fresno	57%	57%	54%
Humboldt	29%	34%	29%
Kern	66%	48%	48%
Lake	86%	70%	63%
Los Angeles	47%	41%	41%
Madera	83%	79%	57%
Marin	26%	21%	20%
Mendocino	63%	44%	48%
Merced	64%	54%	52%
Monterey	57%	52%	50%
Napa	51%	44%	47%
Orange	35%	33%	31%
Placer	53%	47%	41%
Riverside	61%	54%	52%
Sacramento	64%	58%	53%
San Benito	74%	59%	63%
San Bernardino	69%	59%	58%
San Diego	28%	23%	22%
San Joaquin	63%	62%	61%
San Luis Obispo	42%	35%	34%
San Mateo	24%	21%	21%
Santa Clara	31%	28%	23%
Santa Cruz	36%	33%	42%
Siskiyou	42%	54%	59%
Solano	72%	70%	63%
Sonoma	51%	45%	40%
Stanislaus	70%	65%	61%
Tehama	73%	65%	45%
Yolo	51%	45%	46%
California	49%	44%	42%

Source: California Association of Realtors