In California, the sale of distressed properties slowed down as equity sales picked up in February after two months of decline, the California Association of Realtors (C.A.R.) reported this week.
“A lack of inventory in the bank-owned (REO) and short sale market was a contributing factor to the decline in share of distressed sales in February,” said C.A.R. President LeFrancis Arnold. “In fact, REO inventory declined 24 percent in February from the previous year, while short sale inventory dropped 17 percent during the same period.”
The share of distressed properties that sold statewide decreased to 48.9 percent in February, down from January’s 50.1 percent and from 55.2 percent a year ago in February 2011.
When looking at the types of distressed properties sold statewide, short sales were down in February at 23 percent compared to 23.8 percent in January, but still up from last February’s share of 22.9 percent.
The share of REO sales also made a slight downturn in February and stood at 25.2 percent, a drop compared to January’s 25.9 percent and down from the 31.9 percent reported last year in February.
After seeing a two-month decline, equity sales increased in February, making up 51.1 percent of home sales in February. Equity sales made up 49.9 and 44.8 percent of all sales in January 2012 and February 2011, respectively.
Based on signed contracts, C.A.R.‘s Pending Home Sales Index (PHSI) went up from a revised 102.3 in January to 127.8 in February. The index also was up from the 111.8 index recorded February 2011, the 10th month in a row pending sales were higher than the previous year. Pending home sales are forward-looking indicators of future home sales activity and provide information on the future direction of the market.