Foreclosed homes and short sales are making up an increasingly large chunk of the local housing market, moving toward 50% in Glendale, according the latest real estate figures.
Sales of distressed homes made up 47.5% of total sales in Glendale in September, according to figures compiled by Realtor Keith Sorem with Keller Williams in Glendale. In Burbank, the ratio was almost 34%.
The figures were far higher than a year ago, when distressed homes made up about 36% of total sales in Glendale and nearly 16% in Burbank.
The trend started in August as banks ended their self-imposed foreclosure moratoriums.
Short sales, in which lenders let homeowners sell their houses for less than they owe on their mortgages, saw the most dramatic rise in Burbank, skyrocketing from about 4% in September last year to almost 18% last month.
In Glendale, the sale of bank-owned properties jumped from a little less than 11% in September 2010 to about 21% last month.
Sorem said more distressed homes will likely enter the market in the coming months, pushing average home prices down even further.
“Up to this point, I’ve been kind of surprised values haven’t dropped more,” Sorem said. “I think we’re at the tipping point.”
Average home sale prices continued to tumble in September with Burbank taking the biggest hit, dropping $87,530 when compared to September 2010.
The average price in Burbank was $446,655, a 19.6% slide from $534,185 in September 2010.
The number of new home sales also took a hit in September, decreasing from 74 a year ago to 56 last month. There were 63 new listings in September, dipping from 67 in September 2010.
Glendale fared better, though it was still in decline. The average home sale price was $504,244, a 7.1% decrease from $540,258.
New home listings decreased by 15, from 102 in September 2010 to 87 last month. New sales dropped slightly from 64 to 61.
In La Cañada Flintridge, the average home sale price was about $1 million in September, a 2.7% drop from roughly $1.1 million the same month last year.
In the La Crescenta-Montrose area, the bright spot was the number of new home sales, which came in at 37, up from 29 last year. But the average home sale price was $516, 621, about a 1% dip from $520,964 last year, according to Sorem’s report.