If you're a buyer in today's market, I'm sure you're aware of the direction we Realtors have been taking lately... Today's "steals" in Orange County are located in the REO (real estate owned) market also known as bank owned foreclosures. The graph above is from earlier this year but definitely conveys our general direction the next few months. Lender owned properties tend to be priced much more competitively when compared to regular listings; this makes it very difficult for the average seller listing their home. Banks are not in the business to own real estate which explains the low list prices. Often times, agents listing these homes tend to price the REO's below market value to drive activity and create a bidding war.
I referred to them as "steals" because many of the homes are as much as 20 - 30% below the average market value a year ago. This does not mean we are in for another big drop in prices, however. These REO's are being swiped up by many first time buyers, people looking to "move up", and investors. Until this stormy foreclosure season ends, we are in for a different type of market... One that proves to be beneficial for buyers.
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