Foreclosed Homes Don’t Come Cheap

Lenders aren’t exactly dumping foreclosure properties on the market at bargain-basement prices, a new study shows. The average home in Orange County sold for only 3.3% less than its market value after spending six months on the market, according to real estate data firm Experian.

That contradicts earlier reports by real estate agents and other industry professionals who said foreclosures were dragging prices down significantly. Experian compared more than 600 homes sold last year with an estimate based on prices of comparable homes sold in the area. The study pointed out a big difference in discounting practices between lenders. Of those studied, Great Western Bank gave buyers the best deal, slashing foreclosed home prices 8.1% on average. Irvine-based American Savings provided the smallest discounts: 0.7%. Foreclosed home prices were more of a bargain in Los Angeles, where these homes sold for 4.1% less than market price.

Melinda Fulmer covers real estate for The Times. She can be reached at (714) 966-7832.