Truth is, the market is continuing to adjust, and has certainly not settled back into anything we know as “normal.” Not yet. But here are many signs of a brighter future ahead. Short sales are down to 17.7% from their high of 24%, and foreclosed sales (REOs) are way down to 12.4% from a high of 56% Combined our distressed inventory (Short Sales & REOs) took up 80% of the market just a few years ago! Now it’s down to 28.1%. Lastly, the percentage of homes flipped is down to 6.0%, however, this is probably not due to a decrease in interest on the part of these types of investors, but that they are having to compete so much more with everyone else. Before, they could buy up all the bank-owned properties they could afford. Now it appears that everyone on the market wants whatever they can get.
Meanwhile, the lending market has changed. Where are people getting their home loans now? Wells Fargo leads the list with the highest number of loans generated in April at 7.9%, followed by JP Morgan Chase at 2.7% and Prospect Mortgage at 2.5% Notice the absence of some big names? That is no accident. Consumers fed up with the run-around they perceived, backed by a large number of realtors losing deals, due to lack of responsiveness from some bank, lead to both sides all but stopping doing business with those banks that would not or could not work with them. You can do a Google search for borrower frustration and insert the name of any missing big bank. The “Move Your Money Project” (dot org) also had a huge influence in directing borrowers to local credit unions and community banks, both categories taking up a lot of the missing slack. But by the percentages we can easily surmise that they are all participating in a much smaller percentage of the market than the previous big guys. But then none of the new ones will be “too big to fail.”