O.C.s Hottest Selling Homes are Foreclosures

Thomas has a curious “market time” benchmark that calculates how many months it theoretically takes to sell all the inventory in the local MLS for-sale listings at the current pace of pending deals put in escrow. And guess what’s the “hottest” housing niche, by this measure of relative demand vs. supply? Properties listed as “foreclosures” in the MLS.

As of last Thursday, there were 635 properties listed by agents as “foreclosures” (typically, bank-owned houses) in escrow vs. 1,060 for sale, or a “market time” of 1.67 months. Compare that to the countywide total for all homes of 2,285 in escrow (best in 18 months) vs. 15,474 for sale, or a “market time” of 6.77 months.

Foreclosures are even hotter than the best-selling niche by price, housing under a half-million bucks where 1,244 are in escrow vs. 7,138 for sale, or a “market time” of 5.74 months. Or the hottest towns: Aliso Viejo (77 in escrow vs. 313 for sale, or a “market time” of 4.06 months); Cypress (32 in escrow vs. 136 for sale, or a “market time” of 4.25 months; or Lake Forest (74 in escrow vs. 347 for sale, or a “market time” of 4.69 months.)

Not all distressed properties are selling well, though. Short sales, where lenders agree to take less than they’re owed in a sale, are seemingly of low desirability. By Thomas’ math, 404 homes listed by agents as short sales are in escrow vs. 4,281 for sale, or a “market time” of 10.6 months. Almost 10 times the foreclosure sales/inventory pace! The catch with many “short sales” is that lenders are often fickle and slow to agree to these kind of money-losing deals for them.

Compare that to the slowest selling towns — Newport Beach (33 in escrow vs. 585 for sale, or a “market time” of 17.73 months) or Laguna Beach (15 in escrow vs. 307 for sale, or a “market time” of 20.47 months) or the county’s slowest selling price niche, homes above $4 million (10 in escrow vs. 284 for sale, or a “market time” of 28.4 months.)