Why distressed property sales are more than a short-term trend

Even in Dane County, a stable market compared to most others, distressed property sales are a common occurrence. According to Homestead Title's Peter Zarov, 27% of that title company's closings from December 2008 through May 2009 were for distressed properties. In 2006 and prior years distressed sales made up only 2% of closings.

We're expecting distressed property sales to rise for the foreseeable future, and for a number of reasons:

Mortgage delinquencies continue to rise to record levels, according to the Mortgage Bankers Association.
Dane County foreclosures are rising at a rapid pace.
Local unemployment is also increasing.
Meanwhile local prices are decreasing.

Many of the people who need to sell are those who bought their home within the last 5 years, with no or relatively little money down. The end result is a recipe for short sales and bank-owned properties.

We'll be devoting a lot of time to the distressed property market, in particular short sales, in the coming weeks. Plenty more to follow.

Dan Miller, Keller Williams Realty and DaneCountyMarket.com