IRVINE, CA—US bank-owned properties sold during the first quarter of the year had been bank-owned for an average of 226 days when they sold, a 34% increase from the average of 168 days in the first quarter of 2013, reports RealtyTrac. States with above-average time to sell REOs included Texas, Michigan, Minnesota, Colorado and Georgia, according to the firm.
Daren Blomquist, VP of RealtyTrac, tells GlobeSt.com, “The longer time to sell REOs is an indication banks are working through older inventory of REOs that have been lingering as foreclosed homes for a longer period of time. These are likely homes that have been harder for the banks to sell, because of condition or because they are still occupied or for some other reason. For the occupied REOs, it can take the banks longer to sell because they have to go through the eviction process.”
As GlobeSt.com reported last week, rising foreclosure starts and auctions are responsible for US foreclosure activity increasing 4% in March, reports RealtyTrac. Still, first-quarter foreclosure activity was at its lowest level since second-quarter 2007, according to a report from the firm.
The monthly increase in foreclosure activity was driven by a 7% month-over-month increase in foreclosure starts and a 6% monthly increase in scheduled foreclosure auctions. Lenders repossessed 5% fewer US properties in March than the previous month and 34% fewer than a year ago, down to the lowest level since July 2007, an 80-month low.
Properties in the foreclosure process that sold during the first quarter took an average of 509 days to sell after starting the foreclosure process, up 33% from an average of 382 days in the first quarter of 2013, RealtyTrac reports. States with above-average times to sell properties in foreclosure included Massachusetts, New York, New Jersey, Ohio and Florida.
In Ohio, a market that has the nation’s seventh largest REO inventory, Michael Mahon, EVP/broker at HER Realtors, says, “We believe that lenders are taking in more REO inventory in an attempt to take advantage of increasing equity of homes that has occurred in recent months due to lower available inventor in the overall Ohio markets.”