DISTRESSED REAL ESTATE SALES

Distressed Properties

Distressed homes, which include foreclosures and short sales, in which the lender agrees to a transaction for less than the balance of the mortgage, accounted for 24 percent of the September total, up from 22 percent in the prior month, today’s report showed.
All-cash transactions accounted for 28 percent of last month’s sales, and investors, the majority of who are all-cash buyers, accounted for 18 percent.
Private-equity firms such as Colony Capital LLC and Blackstone Group LP, have converged on Phoenix, Atlanta and other distressed areas in search of low-priced properties to buy and rent out, helping to stabilize the markets. These types of investors have raised as much as $8 billion to buy as many as 80,000 single-family homes to manage as rentals, according to a Sept. 21 report by Keefe Bruyette & Woods Inc.
American households may also be drawn into the market as a falling jobless rate helps bolster confidence. Unemployment dropped to 7.8 percent in September, the lowest since PresidentBarack Obama took office in January 2009. The Bloomberg Consumer Comfort Index last week climbed to a six-month high, and a similar measure from Thomson Reuters/University of Michigan jumped this month to a five-year high.