Posts (RSS)Rise in Bank Owned Foreclosed Home Listings Pressuring Home Prices
The increase in the number of homebuyers and investors looking for bargains in bank owned foreclosed home listings and purchasing foreclosed houses have pressured the median home sale price in Sioux Falls, South Dakota to drop by almost 30 percent.
According to the National Association of Realtors‘ report, existing distressed single-family houses in the area posted a median price of $95,500, representing a 30 percent decline in the first three months of this year compared with figures the previous year.
However, local realtors claimed that the decline in median home sale price is not in line with the figures they are expecting. According to Realtor Association of the Sioux Empire Chief Executive Officer Barton Hacker, the median home sale price in the metro area declined by 7.4 percent in March, to $132,000.
Hacker argued that the housing market is not 30 percent down in price despite the increase in foreclosure rate in South Dakota. Data released by RealtyTrac showed that the state’s number of foreclosure homes in the first quarter of 2009 increased by 50 percent from the same period in 2008.
In addition, April foreclosure rate declined by 22 percent compared with March figures, but increase by 56 percent from the previous year.
Meanwhile, both national and local realtor organizations agreed that homebuyers in Sioux-Falls were seeking bargains and discounts in bank foreclosed home listings and houses made affordable by government incentives have allowed many homebuyers to purchase properties.
All these factors have put pressure on the area’s median home sale price, which, unlike the average home price, is not influenced by very low or high-priced sales.
On the other hand, Walter Molony of the National Association of Realtors clarified that the decline in home prices does not reflect the value of the housing market. He pointed out the drop in median sale price is occurring anywhere in the country.
Molony said that almost 50 percent of homes selling across the country are foreclosed houses. In addition, bargain and discounted homes purchased by first-time homebuyers accounted for almost 50 percent of the total number of houses sold.