The Saint Paul Area Association of Realtors just published a report about the state of the local housing market. They get the numbers from the same place that we all get them from the Regional Multiple Listing Service, which is deemed reliable but not guaranteed.
The report indicates that there were 23% fewer distressed* homes sold in 2010 than there were in 2009. Someone messed up on the math because I come up with an 8% difference. Great care was taken with the numbers. They were not rounded. 2010 looks better at 39.9% distressed properties than it would at 40%.
The numbers do not look encouraging, other than the fact that the distressed properties are selling. Prices went up slightly in 2010 but that is up from a low that we have not seen in at least a decade. There is no doubt that this is a good market for home buyers and investors with the low prices and low interest rates. Unfortunately the pool of eligible home buyers has shrunk and will continue to shrink as people are unemployed, underemployed or have been through a foreclosure in recent years and do not have a good enough credit rating to qualify for a home loan.
It is possible that a year from now when we look at the number of distressed properties on the market in 2011 the number will be higher than it was in 2010 reflecting a higher number of foreclosures. We forget that the “robo signing” scandal caused some large banks to hold off on putting foreclosures on the market. They needed to make sure that they actually own the homes they repossessed.
The housing market is what it is and as always there are opportunities for some but not for all.
*distressed is defined as properties that are bank owned or short sales that need bank approval