Mike West

In my continuing quest to learn as much about REO property sales as possible, I present the sold data for Folsom and El Dorado Hills, CA. for the month of April 2008.

There has been the usual seasonal increase in activity overall. with 103 homes selling during the period. Of those, 26, or 25.2% of the sales were REO properties. The averave days on market increased markedly in April. There were quite a few long term REO listings that sold, although 38.5 % if the REOs were on the market for fourteen days or less.

Also noted is the fact that 42.3% of the REO properties sold for the asking price, OR MORE! Are buyers negotiating with the banks to get funding for repairs and upgrades?

Another interesting factor is that the price per square foot advantage for REO homes has lost ground against the cost per square foot for all homes sold. It has been consistently 11% - 14% lower. In April is was only 8.5% lower. You may draw your own conclusions.

Folsom/El Dorado Hills Sold REO Properties April 2008

Original Listing Price SP as % SP as %
DOM Listing Price at Offer Sold Price Original Final Price
1 Fol 3 $234,900.00 $234,900.00 $226,500.00 96.42% 96.42%
2 Fol 21 $289,900.00 $289,900.00 $260,000.00 89.69% 89.69%
3 EDH 234 $399,900.00 $320,900.00 $285,000.00 71.27% 88.81%
4 EDH 180 $299,900.00 $299,900.00 $290,000.00 96.70% 96.70%
5 EDH 103 $369,900.00 $299,900.00 $300,000.00 81.10% 100.03%
6 EDH 8 $315,000.00 $315,000.00 $294,900.00 93.62% 93.62%
7 Fol 3 $324,900.00 $324,900.00 $324,000.00 99.72% 99.72%
8 EDH 62 $264,900.00 $339,900.00 $330,000.00 124.58% 97.09%
9 Fol 211 $449,900.00 $419,900.00 $350,000.00 77.80% 83.35%
10 Fol 194 $345,000.00 $345,000.00 $355,000.00 102.90% 102.90%
11 EDH 22 $399,900.00 $399,900.00 $399,900.00 100.00% 100.00%
12 Fol 2 $399,900.00 $399,900.00 $400,000.00 100.03% 100.03%
13 EDH 30 $ 434,500.00 $434,500.00 $410,000.00 94.36% 94.36%
14 EDH 155 $529,900.00 $449,900.00 $445,000.00 83.98% 98.91%
15 EDH 233 $449,900.00 $455,000.00 $445,000.00 98.91% 97.80%
16 EDH 1 $449,900.00 $449,900.00 $449,900.00 100.00% 100.00%
17 EDH 5 $459,900.00 $459,900.00 $475,000.00 103.28% 103.28%
18 Fol 5 $484,900.00 $484,900.00 $494,500.00 101.98% 101.98%
19 EDH 152 $589,900.00 $514,900.00 $495,000.00 83.91% 96.14%
20 Fol 2 $504,900.00 $504,900.00 $504,900.00 100.00% 100.00%
21 Fol 13 $509,900.00 $509,900.00 $535,000.00 104.92% 104.92%
22 EDH 24 $535,000.00 $535,000.00 $550,000.00 102.80% 102.80%
23 EDH 99 $684,900.00 $609,900.00 $575,000.00 83.95% 94.28%
24 EDH 73 $598,000.00 $598,000.00 $590,000.00 98.66% 98.66%
25 Fol 51 $624,500.00 $609,900.00 $609,900.00 97.66% 100.00%
26 Fol 1 $709,900.00 $709,900.00 $725,000.00 102.13% 102.13%
AVerages 73 95.8% 97.8%

REO Sold Cost Per Square Foot: $184.00 91.5%
Total Sold Cost Per Square Foot: $201.00

Total Number of REO Homes Sold: 26 (25.2% of Total)
Total Number of Homes Sold: 103

My apologies for the alignment. I do not posses the skills to correct that problem.

In the past few days it has become evident that there has been a paradigm shift in the local REO market. Bank owned homes that have been sitting on the market for long periods of time are moving into pending sale status so quickly that it is difficult to keep up. In Folsom, California, alone a full 38.1% of the pending REO homes were active on the market for less than a week!

This is HUGE folks. Properties that I have shown are going pending in one or two days! Its time to gear up and ride the wave. Buyers are not going to have a month or a week to "think about it" any longer. If they don't put in the offer immediately they will miss out! We have to get the word out to all our buyers!

Here are some local statistics. Time precludes researching all of the cities and zip code areas in Sacramento, however, I think you will get the idea from those presented. It is just starting to happen. It looks like the banks are starting to deal!

REO MARKET STATISTICS FOR SOME SACRAMENTO AREAS

% of # % # %
Active Pending Active Pending Pending Pending Pending
REO REO REOs <14 Days <14 Day <7 Days <7 Days
County/City Listings Listings Pending Active Active Active Active

Yolo Co. 118 94 79.70% 34 36.20% 17 18.00%

Placer Co. 254 210 82.70% 64 30.50% 33 15.70%
Granite Bay 9 4 44.40% 1 25.00% 1 25.00%

El Dorado Co. 120 57 47.50% 14 11.70% 6 5.00%
City
El Dorado Hills 30 19 63.30% 7 36.80% 3 15.80%

Sacramento Co. 2467 1483 60.10%
City
Folsom 20 21 105.00% 11 52.40% 8 38.10%
Rancho Cordova 89 55 61.80% 19 34.50% 7 12.70%
Orangevale 22 23 104.50% 9 26.10% 3 13.00%
Fair Oaks 22 15 68.20% 3 20.00% 2 13.33%
Elk Grove 207 206 99.50% 63 31.00% 33 16.00%

Sorry, it was necessary to make corrections to the <14 day numbers.

This is the sixth in a series of Blogs in my quest to determine if REO properties are the great bargain that the public perceives them to be. The subject data is for REO properties in Folsom and El Dorado Hills, CA during January 2008.

The number of REO properties sold during January 2008 was lower than the number sold in December. The 18 homes sold represent 33.96% of all homes sold in the area for the month.

Those homes that were on the market longest tended to sell for a smaller percentage of the original asking price, but not consistently any lower than the final asking price than in any of the previous months for this study.

The cost per square foot of REO homes sold in January was 91.2% of the cost per square foot of all homes sold. That is very similar to the 91.5% in December.

The trends are becoming more evident as the study progresses. The most consistent trend is that the number of REO homes sold in the area in increasing as a percentage of the total homes sold over time. (6.7% in August of 2007 to almost 40% in January. The second consistent factor is that the REO homes have sold for an average of nearly 10% less per square foot than the average cost per square foot for all of the homes that sold for the same period. One would expect that the condition of the homes was a major factor, however, some of the REO homes were in move-in condition.

It is obvious that REO home sales are a consistent factor in our market and will continue to be so for some time. They are going to have an impact on the sale of non-REO properties now and in the future.

Are REO properties the bargain perceived by the public? You must decide for yourself.

Folsom/El Dorado Hills Sold REO Properties January 2009

Original Listing Price at Sold Price SP as % of SP as % of
DOM Listing Price Time of Offer Sold Price Original Price Final Price
1 Fol 42 $342,900.00 $324,900.00 $319,000.00 93.03% 98.18%
2 Fol 6 $339,900.00 $339,900.00 $341,500.00 100.47% 100.47%
3 Fol 17 $349,900.00 $349,900.00 $348,500.00 99.60% 99.60%
4 EDH 75 $449,900.00 $424,900.00 $385,000.00 85.57% 90.61%
5 EDH 105 $462,900.00 $429,900.00 $410,000.00 88.57% 95.37%
6 EDH 124 $469,900.00 $407,900.00 $418,000.00 88.96% 102.48%
7 EDH 0 $429,900.00 $429,900.00 $430,000.00 100.02% 100.02%
8 Fol 21 $422,500.00 $422,500.00 $435,000.00 102.96% 102.96%
9 EDH 10 $448,900.00 $448,900.00 $435,000.00 96.90% 96.90%
10 Fol 44 $515,900.00 $464,500.00 $469,000.00 90.91% 100.97%
11 Fol 8 $499,900.00 $499,900.00 $499,900.00 100.00% 100.00%
12 EDH 50 $569,900.00 $519,900.00 $515,000.00 90.37% 99.06%
13 Fol 12 $539,900.00 $539,900.00 $517,000.00 95.76% 95.76%
14 EDH 5 $513,000.00 $513,000.00 $530,000.00 103.31% 103.31%
15 Fol 191 $639,900.00 $579,900.00 $540,000.00 84.39% 93.12%
16 EDH 90 $593,900.00 $571,900.00 $561,500.00 94.54% 98.18%
17 EDH 175 $798,000.00 $700,000.00 $627,000.00 78.57% 89.57%
18 Fol 43 $805,500.00 $669,000.00 $650,000.00 80.70% 97.16%
Averages 57 93.0% 98.0%

REO Sold Cost Per Square Foot: $188.00
Total Sold Cost Per Square Foot: $206.00

Total Number of REO Homes Sold in November for area: 18 (33.96% of Total)
Total Number of Homes Sold in November for the same area: 53

This is the fifth in a series of Blogs in my quest to determine if REO properties are the great bargain that the public perceives them to be. The subject data is for REO properties in Folsom and El Dorado Hills, CA during December 2007.

The number of REO properties sold during December 2007 was the highest in the five month period that I have reviewed. The 22 homes sold represent 27.2 % of all homes sold in the area for that month. That trend seems to be on the increase.

Those homes that were on the market longest tended to sell for a smaller percentage of the original asking price, but not consistently any lower than the final asking price than any of the other homes.

There was a marked change in the cost per square foot of REO homes sold in December, at 91.5%. That number has remained in the 85%- 86% range until December.

Home Number five in the list below sold for 73.4 of the original asking price in five days. That is the lowest percentage of any home in the five month period. One would expect that the condition of the home was a major factor.

Are REO properties the bargain perceived by the public? You must decide.

Folsom/El Dorado Hills Sold REO Properties December 2007
Original Listing Price SP as % SP as %
DOM Listing Price at Time of Offer Sold Price Original Price Final Price
1 EDH 133 $405,000.00 $325,000.00 $295,000.00 72.84% 90.77%
2 Fol 22 $360,000.00 $360,000.00 $325,000.00 90.28% 90.28%
3 EDH 108 $369,900.00 $339,500.00 $330,000.00 89.21% 97.20%
4 Fol 18 $348,900.00 $348,900.00 $355,000.00 101.75% 101.75%
5 Fol 5 $365,000.00 $365,000.00 $266,650.00 73.05% 73.05%
6 EDH 82 $371,900.00 $371,900.00 $372,000.00 100.03% 100.03%
7 EDH 97 $454,900.00 $428,500.00 $386,925.00 85.06% 90.30%
8 EDH 116 $464,900.00 $419,500.00 $395,000.00 84.96% 94.16%
9 EDH 35 $429,000.00 $419,900.00 $400,000.00 93.24% 95.26%
10 Fol 152 $504,900.00 $454,900.00 $409,000.00 81.01% 89.91%
11 Fol 42 $459,900.00 $429,900.00 $420,000.00 91.32% 97.70%
12 EDH 16 $454,900.00 $454,900.00 $435,000.00 95.63% 95.63%
13 EDH 54 $494,900.00 $484,900.00 $480,000.00 96.99% 98.99%
14 EDH 118 $600,000.00 $505,000.00 $490,000.00 81.67% 97.03%
15 Fol 9 $559,900.00 $559,900.00 $535,000.00 95.55% 95.55%
16 EDH 8 $549,900.00 $549,000.00 $539,000.00 98.02% 98.18%
17 Fol 37 $605,900.00 $605,900.00 $550,000.00 90.77% 90.77%
18 EDH 3 $554,900.00 $554,900.00 $555,000.00 100.02% 100.02%
19 EDH 126 $719,900.00 $579,900.00 $579,900.00 80.55% 100.00%
20 EDH 28 $723,900.00 $712,900.00 $700,000.00 96.70% 98.19%
21 EDH 43 $949,900.00 $935,900.00 $930,000.00 97.91% 99.37%
22 EDH 41 $964,900.00 $959,900.00 $940,000.00 97.42% 97.93%

Averages 59 90.6% 95.1%

REO Sold Cost Per Square Foot: $194.00
Total Sold Cost Per Square Foot: $212.00

Total Number of REO Homes Sold in November for area: 22 (27.2% of Total)
Total Number of Homes Sold in November for the same area: 81