Distressed property sales accounted for just 12.7 percent of residential real estate transactions nationwide in 2014, the lowest share since 2007, according to Black Knight's February 2015 Mortgage Monitor released today. The share of distressed sales for 2014 was down from 17 percent reported for 2013. The distressed sales share reached its peak in 2011 when 33 percent of all residential real estate transactions were short sales or REO sales.
Short sales declined by 45 percent year-over-year in 2014, and REO sales dropped by 16 percent. The average short sale discount for 2014 was 23 percent, meaning properties sold in short sales for an average of 77 cents on the dollar as compared to traditional market sales. The short sale discount reached its peak of 25.3 percent in July 2013. By comparison, the REO discount is on the rise, increasing up to 27 percent – its highest level since Q4 2012. The peak for REO discounts was 29 percent, reached in April 2009.
After months of solid gains with the administration touting that the labor market is at its healthiest level since the turn of the century, payroll employment increases for March fell well short of expectations with just 126,000 obs added, according to data released the Bureau of Labor Statistics on Friday. The jobs report for March, which Fannie Mae Chief Economist Doug Duncan termed "disappointing," follows a 12-month period which averaged 266,000 jobs per month added. Duncan said the data seems to indicate that more economic improvement is needed before significant housing improvement can occur.