The distressed sales share was reported at 9 point 7 percent as of the end of September 2015, according to data released by CoreLogic on Wednesday. The distressed sales share has been on a steady decline for the last six years since reaching a peak of 32 point 4 percent—nearly one-third of all residential home sales—but at approximately 10 percent in September, it is still approximately five times its normal pre-crisis level of 2 percent.
Though the distressed sales share remained at nearly five times its pre-crisis level, the share of REO sales is down. In September, REO properties accounted for 6 point 4 percent of all residential home sales, the lowest level since October 2007 when it was 6 point 2 percent. At their peak in January 2009, REO sales accounted for 28 percent of all home sales. Meanwhile, in September 2015, short sales made up 3 point 3 percent of all residential home sales. The short sales share has been in the 3 to 4 percent range since dropping below 4 percent in mid-2014.
While tight inventory combined with increasing home prices have caused some concern about affordability as of late, the Federal Reserve reported in its December Beige Book released Wednesday that housing markets improved at a “moderate” pace on balance since the previous Beige Book was issued in mid-October. Rising home sales in seven of the Fed’s 12 districts—Boston, New York, Philadelphia, Cleveland, Richmond, Chicago, and Kansas City—were largely responsible for the Fed’s reports of moderate growth in housing markets.