All the Real Estate News That’s Fit to RE-Print™
Welcome to our weekly edition of Real Estate Investing News This Week. Here’s the best of this week’s real estate news:
- Foreclosure inventory and delinquencies are down
- Institutional investor purchases reach new high
- Mortgage application fraud is down
- High-end home flipping is up 34%; overall flipping is down 13%
We hope these real estate news items help you stay up-to-date with your real estate investing strategies and inspire some profitable real estate deals for you.
RealtyTrac released its Q3 2013 Home Flipping Report, which shows 32,993 single family home flips — where a home is purchased and subsequently sold again within six months — in the third quarter of 2013, down 35 percent from the second quarter and down 13 percent from the third quarter of 2012.
The report also shows that real estate investors made an average gross profit of $54,927 on single-family home flips in the third quarter. That was up 12 percent from an average gross return of $48,893 in the third quarter of 2012.
“Increasing home prices over the past 18 months combined with decreasing foreclosures have created a market less favorable to the high quantity of middle- to low-end bread-and-butter flips that we saw late last year and early this year,” said Daren Blomquist, vice president at RealtyTrac. “But the sharp rise in high-end flipping indicates there is still good money to be made for flippers….”
In this report, CoreLogic Chief Economist Mark Fleming, Ph.D., discusses mortgage application fraud risk in an evolving market and Deputy Chief Economist Sam Khater explains the decline in negative equity in the first half of 2013.
Additional key findings in the October MarketPulse report include:
- The mortgage application fraud risk index is down 5.6 percent in the second quarter of 2013 compared to the same time period a year ago.
- While the propensity for mortgage fraud is declining from its peak in 2012, the overall amount is increasing as mortgage loan applications increase.
- The bulk of the decline in negative equity has been confined to the first half of this year when home prices increased 10 percent.
To obtain a copy of this report, including a complete set of data and charts, visit the MarketPulse page.
Cash Sales Up to 49% of All Residential Sales
On Tuesday, RealtyTrac® released its September 2013 Residential & Foreclosure Sales Report, which shows that U.S. residential properties, including single family homes, condominiums and townhomes, sold at an estimated annualized pace of 5,673,249 in September, up 14 percent from September 2012.
The sales price of all residential properties — including both distressed and non-distressed — in September was $174,000, up 6 percent from September 2012.
The median price of a distressed residential property — in foreclosure or bank-owned — in September was $112,000, 41 percent below the median price of $189,000 for a non-distressed residential property.
Distressed sales combined accounted for 25 percent of all sales in September, up from 18 percent of all sales a year ago.
“Distressed sales remain persistently high, particularly short sales,” said Daren Blomquist, vice president at RealtyTrac.
Other high-level findings from the report:
- Institutional investors (purchasing 10 or more properties in the last 12 months) accounted for 14 percent of all sales in September, up 9 percent from a year ago.
- All-cash purchases represented 49 percent of all residential sales in September, from 30 percent in September 2012.
- Short sales accounted for 15 percent of all residential sales in September, up from 9 percent in September 2012.
- Sales of bank-owned homes accounted for 10 percent of all residential sales in September, up from 9 percent in September 2012.
- 3,266,000 mortgages are 30 or more days past due but not yet in foreclosure — 1,331,000 have missed at least three payments but haven’t started the foreclosure process.
- September’s delinquency rate is 12.63 percent
- Pre-sale foreclosure inventory is down 32.18 percent from last year
- In total, 4,594,000 mortgages are going unpaid (compare: 5,640,000 in September 2012)