Online real estate tracker Zillow www.zillow.com reports that the share of Orange County single-family homes with mortgages larger than the current value of the home — so-called “negative equity” or “underwater” — was 14.4% percent in the 4th quarter of 2009, barely up from Q3’s 14%.
If that percentage sounds low, it is because according to Steve Thomas at Altera Real Estate, distressed properties now represent 33% of the market in Orange County.
But the Thomas numbers are active sales. Zillow’s math covers all single family homes in O.C., including those not on the market. (About a quarter of homes here have no mortgage to begin with.)
“We estimate 62,988 single-family homes in negative equity in Q4 out of an estimated 436,163 single-family homes (with mortgages) overall in Orange County,” said Jill Simmons of Zillow.
The number of homeowners losing their homes to foreclosure across the country peaked in December, with more than one in every thousand homes being repo’d, a high since Zillow began recording this foreclosure data in 2000.
Back to Orange County statistics, Steve Thomas of Altera Real Estate writes,
“Current statistics…do not reflect that there are fewer distressed homes coming on the market; rather, they mean that increased demand is eating up the active distressed inventories. Over the past month, the number of distressed and non-distressed homes to hit the market has been increasing, but many are going off the market as pending sales just as quickly as they are coming on.
“The number of foreclosures increased in the past two weeks from 355 to 375. The expected market time for foreclosures is a sizzling 0.90 months, a deep seller’s market. Foreclosures garner so much activity that they are like individual mini auctions and the successful buyer is really the successful bidder.
“The number of short sales on the active inventory decreased by 69 and now totals 2,249. The expected market time for short sales is 1.63 months, also a deep seller’s market. 33.7% of the active inventory is distressed. Last year at this time 44% of the inventory was distressed.”
For the breakdown, go to the Mortgage Insider Blog
What does this mean for buyers? I have a number of pre-approved buyers with 20% down and better who have made multiple offers, but can't get one accepted. They are running into all-cash buyers, or buyers with higher down payments. It is extremely tough to get an offer accepted. It is important to provide a complete package at the offer stage and put as much down as possible to sweeten the deal in the eyes of the seller.
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