REO Price Increases Bode Well for Overall Market

Recent price increases with bank-owned homes are helping to provide an overall boost to the housing market, a recent report from Clear Capital says. Prices of REOs nationally rose 8.1 percent over year-ago levels on a median price-per-square-foot basis, according to Clear Capital’s May housing data. “Strength in the REO-only price trends as well as some early indications of price gains spreading from low-tier sectors to the mid- and higher-priced homes is helping confirm that the country continues to make progress on its recovery,” says Alex Villacorta, director of research and analytics at Clear Capital. “We are expecting to see improvements extend over the next several months.” Clear Capital also reported quarterly increases to overall prices, rising 0.4 percent for the quarter, the first quarterly gain posted since November 2011. The West saw the most growth in prices, rising 2.7 percent, followed by the South, with a 1.2 percent quarter-over-quarter gain, according to the report. Source: “Improving Foreclosure Prices Drive Recovery,” RISMedia (June 6, 2012)