December 4th, 2010 9:34 AM by Lehel S.
The foreclosure paperwork debacle and the expiration of federal tax credits for buyers appears to be having some effect on the sale of bank-owned properties and otherwise distressed homes.
Irvine-based RealtyTrac, a company that publishes listings of foreclosed properties online, said in a report Wednesday that sales of U.S. properties in some stage of foreclosure dropped 25% in the third quarter from the previous quarter and 31% from the third quarter of 2009.
“The expiration of the home buyer tax credit in the second quarter created a substantial dip in overall buyer demand in the third quarter,” said James J. Saccacio, chief executive of RealtyTrac. “Demand for foreclosures also dipped in the third quarter.”
Several national banks have frozen or slowed foreclosure sales in recent months. The moves come after major lenders acknowledged that in some states where a court order is required to seize a home they employed so-called robo-signers, who attested to the accuracy of foreclosure documents without reading them.
A total of 188,748 U.S. properties in some stage of foreclosure — default, scheduled for auction or bank-owned — sold to third parties in the third quarter, RealtyTrac said. The average price of these distressed properties fell 2.5% from the previous quarter and 0.5% from the third quarter of 2009 to $166,523.