A noteworthy threshold was broken over the weekend. The Reno-Sparks’ real estate market now has fewer than 100 bank-owned houses available – 98 to be precise (active, non-pending, site/stickbuilt SFRs). Why is this noteworthy? Because normally many more than that number sell on a monthly basis. Here are the number of REOs sold over the past six months.
| Month | REOs Sold | % of total sales |
|---|---|---|
| Apr-12 | 113 | 27% |
| Mar-12 | 172 | 32% |
| Feb-12 | 195 | 42% |
| Jan-12 | 175 | 39% |
| Dec-11 | 181 | 34% |
| Nov-11 | 167 | 34% |
As can be seen the number has been declining – and will continue to do so. Whereas REOs typically represented 30 – 40 percent of our market’s inventory, bank-owned properties now account for only 12 percent. And if some of the comments from my previous post are accurate, there looks to be no increase in the number of REOs entering our market until late 2013, when any changes to AB284 may be effected.
The effects of AB284 are being felt statewide. Take a look at these recent numbers for the Las Vegas market. [Click on the graphic to enlarge]
source: Ticor Title
As can be seen in the table, like the Reno-Sparks market, Las Vegas and Henderson have less than a two-month supply of inventory, with REOs now comprising only a small part of the inventory mix.
Reno Ignoramus
Hi Guy,
There will still be some REOs entering the market in the coming months. AB 284 shut off the spigot for new NODs as of October 1 of last year, but there are stll some (unknown) number of foreclosures that were already commenced prior to last October. How many of these there are has been the topic of endless speculation here on this blog and other places as well. Everybody has some half-baked or fully baked opinion about this, but the reality is that nobody knows how many future REOs from already recorded NODs there are out there in the pipeline that can yet still come to the market.
Tom Joad
It looks like this could turn pretty ugly for a lot of realtors. If sales volume drops by 70% and REOs mostly dissapear, where will the commissions come from?
I trust you have seen this coming Guy and have planned for it. Hopefully this blog serves as a good marketing tool for you.
Matthew
What’s really perplexed me is the quantity of bank-owned properties which are simply being withdrawn from MLS….
Gavin
Great blog you’ve got going on here! Thanks for sharing
Guy Johnson
Thank you Gavin. Much appreciated.
Btw, I checked the number of REOs available this morning – only 70 currently available for sale.