Big Number of South Carolina Foreclosures Account for Q1 Home Sales

by on States

More than 20% of residential properties sold in the 2010 first quarter are South Carolina foreclosures. This represents an increase from previous year's figures when 19.8% of houses sold were foreclosed properties. It is also higher when compared with the 2009 fourth quarter which showed that 15.88% of total dwellings sold are foreclosed residential properties.

Compared with national statistics, state numbers are actually better. Wachovia foreclosures and other bank foreclosures are fewer than the national number which is pegged at more than 30%. However, the prices of homes in the state are experiencing the same decline as nationwide prices, with majority of homes being sold for 20% less than market value.

Investors and regular homebuyers are buying home foreclosures for large discounts, which encourage them to purchase more of these bargain properties, according to local real estate reports. Supplies are also aplenty as lenders are repossessing residential properties in the state at record levels.

According to real estate market analysts, the high inventory levels of South Carolina foreclosures and repossessed dwellings are causing the prices of houses to decline significantly. In the first quarter of the year, high number of repossession in the state caused sale prices to deteriorate rapidly.

Market numbers also showed that there is a marked difference between the prices of distressed and repossessed properties. A distressed home has an average price difference of more than one percent when compared with regular market prices, while bank owned homes for sale, or those whose ownerships have reverted to the lender, have selling prices that offer more than 26% of discount to buyers when compared with regular market prices.

Local real property market reports also showed that majority of distressed residential properties are sold through short sales. As an example of price differences, sales of houses through short sales provide buyers with over 23% of price difference in Charleston, while repossessed dwellings can provide buyer savings of more than 24% when compared with a regular or new house purchase.

South Carolina foreclosures account for a significant part of home sales in the state and the trend is expected to continue through the second half of 2010. Short sales are still expected to be the primary means of selling distressed homes.