I track the local market on a weekly basis - See the real Estate Statistics sections of either of my web sites - http://www.themilfordteam.com/ or http://www.movetomilford.com/. This week's statistics, about what sold last week, provide a short term glimpse of how the market has been lately. 80% of the homes that sold last week were foreclosures.
I've been reporting for some time that I'm primarily showing foreclosures to clients - see Repo Man, my September 13th blog entry. Until last week the share of sale that were foreclosures was normally 30-40% and never higher than 50%. I suspect that we'll see this trend for a few months as the bargain hunters pick over the foreclosure inventory. I have three foreclosure deals in progress right now myself, so I can't complain. If I weren't selling foreclosures I'd likely not be selling anything right now.
The other thing that is noticeable is the very low prices that many of these properties are selling for these days. Banks seem to be in "dump 'em" mode, just trying to get out with whatever they can get. I reported back in the fall that the old SEV to price formula (price = 2 X SEV) had gone out the window in this market. recently these dumped foreclosure homes have broken through the 1.0 X SEV level, with many selling for below SEV. If the houses aren't trashed or haven't been damaged through neglect, that makes them great bargains. Many are in really nice neighborhoods and just need some quick TLC to return to their previous values (or what passes for that these days).
The foreclosure market is creating a whole new group of real estate investors and speculators. These are people who never imagined themselves buying and flipping houses; but, who now see opportunity in such a down market. Whether or not they have adequately planned for the expense and time required to accomplish the fix-up and re-sale of the properties remains to be seen. Some of them will undoubtedly be involved in the next wave of foreclosures, hopefully not also involving their primary residences too.