Think most of the home for sale are foreclosures? Think again. Tampa Realtors have been struggling to meet the demand for bank owned (or REO) homes as the supply of foreclosures has waned. For example, there are currently 12 REO listings in New Tampa out of 324 single family homes for sale; while 13 REOs are under contract (out of 192 homes total under contract).
According to Realtyrac, there are 748 bank owned single family homes in the city of Tampa. MLS data reveals that 163 of these are actively for sale, while another 206 are under contract. Hence, about half of the foreclosed bank owned homes are in the market. To put this in perspective, overall MLS data shows that bank owned single family homes represent just 4.42% of all Tampa single family homes for sale, and 13.43% of pending sales in Tampa.
There are 3684 homes for sale in the overall market, and 1534 homes under contract according to Tampa MLS data. The high number of pending sales can be partially attributed to the attractive lower home prices, as well as the large number of short sales that languish in contract pending status for an average of 5 months.
Digging deeper, how do distress sales compare to traditional sales? Of the 583 homes currently under contract that are not distress sales (short sales or bank owned) in the city of Tampa, the average home was listed for $225,364 and went under contract within 129 days for $108 per square foot. Of the 745 short sales currently under contract , the average home was listed for $156,512 and went under contract within 144 days for $85 per square foot. The 206 bank owed homes (foreclosures) under contract were on the market for an average of 76 days for an asking price of $90,000, or $54.50 per square foot. In case your are wondering, bank owned homes have been selling for 96% of the final asking price.
The encouraging numbers in the Pending Sales Index and the Absorption Rate do not take into count the number of homes which will eventually come onto the market. Recent studies show that just 6% of homeowners catch up once they fall behind on their payments (cure rate), and the data indicates that large numbers of Tampa area homeowners are in default. This “shadow inventory” will impact the market for years to come as these homes are added to the supply of active listings. Hence the supply shortage of foreclosed homes for sale may be fleeting.
