Investors bought 14% of U.S. homes in Sept.

IRVINE, Calif. – Oct. 24, 2013 — RealtyTrac’s September 2013 U.S. Residential & Foreclosure Sales Report, which includes single-family homes, condominiums and townhomes, found homes sales up 2 percent from August and 14 percent compared to September 2012. It also found a preponderance of purchases by investors and all-cash sales.

The national median sales price of all residential properties — including both distressed and non-distressed — in September was $174,000, up 1 percent from a revised $172,000 median price in August and up 6 percent from a $164,500 median price year-to-year. Distressed sales combined accounted for 25 percent of all sales in September, up from 18 percent of all sales a year ago.

“The housing market continues to skew in favor of investors, particularly deep-pocketed institutional investors, and other buyers paying with cash,” says Daren Blomquist, vice president at RealtyTrac.

However, investors appear to be pulling back from higher-priced markets and focusing their money on cities where they see more opportunity, such as Jacksonville. Places like San Francisco, Washington, D.C., New York, Seattle and Sacramento are falling out of favor, according to RealtyTrac. Investors are focusing on markets with median prices still below $200,000 – places like Jacksonville, Atlanta, Charlotte, St. Louis and Dallas.

“Distressed sales remain persistently high, particularly short sales,” Blomquist says. “Markets with the biggest increases in short sales tend to be those where either foreclosure starts or scheduled foreclosure auctions have rebounded in the last 18 months – translating into more motivated short sellers – or those with a still-high percentage of underwater homeowners with negative equity.”

Other report findings

• Institutional investors (those who bought 10 or more properties in the last 12 months) accounted for 14 percent of all sales in September, up from 9 percent in August and also 9 percent in September 2012. September had the highest percentage of institutional investor purchases since RealtyTrac began tracking in January 2011.

• Among metro areas with a population of 1 million or more, those with the highest percentage of institutional investor purchases in September were Atlanta (29 percent), Las Vegas (27 percent), St. Louis (25 percent),Jacksonville, Fla., (23 percent), Charlotte, N.C., (17 percent), Memphis, Tenn. (16 percent), Richmond, Va., (15 percent), Dallas (15 percent), and San Antonio, Texas (15 percent).

• All-cash purchases nationwide represented 49 percent of all residential sales in September, up from a revised 40 percent in August and up 30 percent in September 2012.

• Among metro areas with a population of 1 million or more, those with the highest percentage of all-cash sales were Miami (69 percent), Tampa, Fla. (62 percent), Jacksonville, Fla. (62 percent), Las Vegas (62 percent),Orlando, Fla., (59 percent), Atlanta (54 percent), Cleveland (51 percent), and Memphis, Tenn. (51 percent).

• Short sales accounted for 15 percent of all U.S. residential sales in September, up from 14 percent in August and 9 percent in September 2012. States with the biggest percentage of short sales were Nevada (32 percent),Florida (30 percent), Ohio (26 percent), Maryland (22 percent), and Tennessee (21 percent).

• Among metro areas with a population of 1 million or more, those with the highest percentage of short sales were Las Vegas (34 percent), Columbus, Ohio (33 percent), Tampa, Fla. (33 percent), Memphis, Tenn., (32 percent), and Miami (32 percent).

• Sales of bank-owned homes accounted for 10 percent of all U.S. residential sales in September, up from 9 percent in August and also 9 percent in September 2012. Among metro areas with a population of 1 million or more, those with the highest percentage of bank-owned sales were Las Vegas (21 percent), Riverside-San Bernardino, Calif., (20 percent), Cleveland (19 percent), Phoenix (18 percent), and Columbus, Ohio (16 percent).

• Annualized sales volume increased from the previous month in 34 out of the 38 states tracked in the report and was up from a year ago in 35 states. Notable exceptions where annualized sales volume decreased from a year ago were California (down 15 percent), Arizona (down 11 percent), and Nevada (down 5 percent).

• States with the biggest annual increases in median prices were California (up 30 percent), Michigan (up 25 percent), Nevada (up 23 percent), Georgia (up 20 percent), and Arizona (up 20 percent).

• Among metro areas with a population of 1 million or more, those with the biggest annual increases in median prices were San Francisco (35 percent), Detroit (34 percent), Sacramento (33 percent), Atlanta (27 percent), Riverside-San Bernardino, Calif., (26 percent), and Phoenix (25 percent).

Investor activity in select Florida cities

• Miami-Fort Lauderdale-Pompano Beach: 11% investors; 69% cash sales; 32% short sales; 11% REOs.
• Tampa-St. Petersburg-Clearwater: 11% investors; 62% cash sales; 33% short sales; 9% REOs
• Orlando-Kissimmee: 11% investors; 59% cash sales; 31% short sales; 9% REOs
• Jacksonville: 23% investors; 62% cash sales; 24% short sales; 8% REOs

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Reprinted with permission. Florida Realtors®. All rights reserved.

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