Foreclosured Homes Sell at 7% Below California Market Value

A typical lender-foreclosed home in California sold, on average, 7.2% below its market value in the first quarter of 1997 and was on the market for 15 months, according to Experian, the real estate information company formerly called TRW-REDI.

Using a computer-assisted valuation model, Experian analyzed bank-owned homes with a combined mortgage value of $781 million. Experian determined the market value of a foreclosed property, which was then compared to its actual sale price to gauge the impact of foreclosure sales on market values.

Experian estimates that in 1997, 65,000 foreclosures will be sold in California, representing about 17% of all home sales in the state.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

1st Quarter ’97 Foreclosure Sales

*--*

Seller Months on Sales Price the Market Percent Below Market Value American Savings 17 2.8 Bank of America 9 9.9 Bankers Trust 9 9.3 Federal Home Loan Mortgage 16 4.6 Fannie Mae 10 3.6 Great Western 7 10.3 Home Savings 9 6.7 Housing and Urban Development 24 13.5 Prudential Home Mortgage 8 3.9 Texas Commerce Bank 7 3.4 Veteran’s Administration 27 9.8 Wells Fargo 8 9.1 World Savings 8 1.6

*--*

Source: Experian