U.S. Home Sales Increase, Investor Purchases Up

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The number of homes sold in the U.S. increased 10 percent in December, compared to the previous year, with foreclosure and short sales accounting for a higher percentage, according to a new report from RealtyTrac. 

U.S. homes -- single-family, condominiums and townhouses -- sold at an estimated annual pace of 5,167,255 in December, growing less than 1 percent from the previous month, but increasing 10 percent from December 2012. 

In 2013, short sales and foreclosure-related sales -- including both sales to third party buyers at the public foreclosure auction and sales of bank-owned properties -- accounted for a combined 16.2 percent of all U.S. homes sales, increasing from 14.5 percent of all sales in 2012 and up from 15.2 percent of all sales in 2011.

"It may surprise some to see distressed sales rising in 2013 given that new foreclosure activity dropped to a seven-year low for the year," Daren Blomquist, vice president at RealtyTrac, said in the report. "And while short sales did trend lower in the second half of the year, there are still more than 1.2 million properties in the foreclosure process or bank-owned, providing a sizable pool of inventory that the housing market is in the process of absorbing." 

Sellers who do not have distressed properties are generally staying out of the market, helping to keep the distressed share of sales at a "stubbornly high level," Mr. Blomquist said. 

Although national home sales increased, annualized sales volume dropped in December from a year ago in 18 of the nation's 50 largest metropolitan areas and fell in five states: California, Arizona, Nevada, Rhode Island and Oregon.

The national median sales price of U.S. homes -- including both distressed and non-distressed sales -- was $168,391 in December, unchanged from November and up two percent from December 2012. 

The median price of a home in foreclosure or bank-owned was $108,494 in December, 38 percent below the median price of $174,401 for a non-distressed home, RealtyTrac reports. 

More from the report: 

• States with the highest percentage of REO sales in December were Nevada (18.9 percent), Michigan (18.4 percent), Ohio (17.8 percent), Arizona (15.7 percent), and Illinois (14.7 percent).

• Short sales (where the sale price is below the total amount of outstanding loans secured by the property) accounted for 5.7 percent of all U.S. residential sales in December, up from 5.1 percent in November but down from 6.7 percent in December 2012.

• States with the highest percentage of short sales in December were Nevada (15.3 percent), Florida (14.4 percent), Illinois (9.0 percent), Maryland (8.2 percent), New Jersey (7.9 percent), and Michigan (7.2 percent).

• Major metros where third party foreclosure auction sales accounted for at least 2.5 percent of all residential sales included Atlanta (4.7 percent), Orlando (3.9 percent), Miami (3.9 percent), Tampa (3.4 percent), Columbia, S.C. (2.8 percent), Las Vegas (2.8  percent), and Charleston, S.C. (2.8 percent).

• All-cash purchases accounted for 42.1 percent of all U.S. residential sales in December, up from a revised 38.1 percent in November, and up from 18.0 percent in December 2012.

• States where all-cash sales accounted for more than 50 percent of all residential sales in December included Florida (62.5 percent), Wisconsin (59.8 percent), Alabama (55.7 percent), South Carolina (51.3 percent), and Georgia (51.3 percent).

• For all of 2013, 29.1 percent of U.S. residential sales were all-cash purchases, but the percentage trended substantially higher in the second half of the year. The 29.1 percent in 2013 was up from 19.4 percent in 2012 and 20.6 percent in 2011.

• Institutional investor purchases (comprised of entities that purchased at least 10 properties in a year) accounted for 7.9 percent of all U.S. residential sales in December, up from 7.2 percent the previous month and up from 7.8 percent in December 2012.

• Metro areas with the highest percentages of institutional investor purchases in December included Jacksonville, Fla., (38.7 percent), Knoxville, Tenn., (31.9 percent), Atlanta (25.2 percent), Cape Coral-Fort Myers, Fla. (24.9 percent), Cincinnati (19.3 percent), and Las Vegas (18.2 percent).