Foreclosure Deception
A short sale is a home which an owner tries to sale to get out of their hefty mortgage payments. They have incentive to do this because their home is overvalued and they know they are getting ripped off on their mortgage, or they are about to foreclose and they want to avoid that. Foreclosures are when you can\’t make your payments anymore
Orange County has taken a lot of flack recently for being an area with a large amount of foreclosures. The reality is, Orange County follows the same trends that most of the metro areas on the east coast have been following.
Consider this – Orange County is at 10% of their listings being foreclosures. If we travel a large distance north to another metro area, Washington has 11% of their listings as foreclosures. In case that\’s hard to grasp, Orange County has fewer foreclosures than Washington.
One the flip side of things, another important metric to look at is the percentage of short sales. In Orange County, the percentage of short sales has climbed to about 26% of home listings right now.
So let\’s think of this way. 1 in 6 listings are short sales in Washington… 1 in 4 listings are short sales in Orange County. 33% more are short sales. That\’s a substantial difference. But what is that difference you ask?
Here\’s what a high short sale amount means. People bought homes when they cost a lot of money. Suddenly home values weren\’t so high anymore, in fact they slid backwards. So those who had just bought a home, realized they spent way to much for it. So if they get out of their current mortgage, they can buy a home at market price. So that\’s what they try to do, sell their home (so they\’re not wasting money towards a mortgage), and try to get a different one at a reasonable price. Blame it all on the housing bubble.
This makes for a slow house sale situation. Everybody with their homes for sale are waiting for everybody else to come and purchase their home, and they can\’t purchase unless somebody comes and purchases theirs…
What does this all mean for you, the home buyer? It means that next time you stop in Orange County, or you are thinking about relocating, you need to check out the home listings there.
While they\’re on your mind, check out Orange County Foreclosures For Sale and Orange County Short Sales
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