Foreclosures: Contradictory Messages and Different Numbers?
The California Association of Realtors announced recently that foreclosure sales have increased 92.3% year over year in March 2010. In February 2010 this increase was 24.2% as compared with February 2009. This information comes directly from ForeclosureRadar’s March foreclosure report. Elsewhere there is information that real estate prices are set to fall once again.
I just want to jump into this and clarify the difference between foreclosure sales as reported by companies like ForeclosureRadar and this website. Our information comes solely from the MLS and what our website calls “foreclosure sales” are those homes that have been placed on the open real estate market by banks and listed by a real estate broker. These homes are considered REOs, or “real estate owned” by the bank, houses that have been foreclosed on by banks due to lack of mortgage payment by home owners.
Most companies that keep track of real estate sales data that are not primarily a real estate brokerages also count the “sale” of a home back to the bank as a foreclosure sale, which is why their numbers always appear more numerous than our totals. In their case, the foreclosure of one home can appear twice - one sale to the bank, the other to a homebuyer, while we would only count the latter. It is an important difference to remember.
