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Commercial Foreclosed Properties Fail to Hinder Luxury Market

Residential and commercial foreclosed properties have often been blamed for the decline in property prices and values, particularly in hard hit areas like California. However, 2010 fourth quarter data showed that the luxury home market of San Francisco and several other local areas were able to take on the challenge posed by cheap foreclosures as prices in the luxury category increased during the period.

Prices of luxury dwellings jumped during the period October-December 2010 despite the many lower-priced houses offered at foreclosure auctions in San Francisco. Compared with the 2010 third quarter, prices of higher-end houses increased by 1.6% in the metro area and also recorded a 3.6% rise when compared with the 2009 fourth quarter. During the last quarter of 2010, the average selling rate for a luxury house in San Francisco was around $2.6 million.

Although California foreclosure auctions remained at elevated levels last year, several other local areas in the state posted improved selling prices for luxury residences. In Los Angeles, prices for high end houses jumped by 0.6% in the 2010 fourth quarter compared with the previous three-month period. However, the 2010 fourth quarter average price of $1.97 million was actually lower by 2.2% than the average rate recorded in the same 2009 quarter.

Since California has some of the nation's highest numbers of residential and commercial foreclosed properties, people expect prices to decline in almost all categories, particularly in the luxury segment. However, this is untrue in San Francisco, Los Angeles and even in San Diego where prices of high end homes have been rising. San Diego luxury residential prices were up in the fourth quarter by 0.8% compared with the previous quarter. Compared with one year ago, the increase was 0.6%.

Housing industry analysts stated that more people still buy foreclosure auction homes in the region, but the low interest rates and the growing consumer confidence have convinced buyers of more expensive homes to take the plunge. They also cited the rise in the stock market as another factor since majority of luxury home buyers have their wealth invested in stocks.

Commercial foreclosed properties and distressed homes are expected to rise further in California in 2011. However, luxury home sellers are confident that the segment will be able to keep up, given its strong performance amid the foreclosure crisis. The last time prices of luxury houses increased in the three California markets was in the 2007 second quarter.

Commercial Foreclosed Properties Fail to Hinder Luxury Market is a post from Foreclosure-Auction.net – Your online source for foreclosure property auctions.

Commercial Foreclosed Properties Fail to Hinder Luxury Market was verified at Home Auctions Blog while researching Real Estate and provided for by Free Moving Company Quotes

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Foreclosure Listing Prices Continue to Drop in Major U.S. Markets

Prices of properties in foreclosure listing and non-foreclosed dwellings have hit an all time low in the U.S., housing industry analysts have reported. They stated that prices are likely to decline further in the coming months. A big number of metro areas have reportedly reached their lowest points in terms of home prices. Analysts have stated though, that very few are taking advantage of the low prices.

According to market analysts, even with cheap houses in abundance, buyers are staying away from the market. They stated that part of the reason is the tight lending environment which makes it difficult for buyers to secure loans. Others are waiting on the sidelines, believing that prices will decline further in the coming months. There is also the factor of unemployment, analysts have said.

They explained that even those who are willing to make a purchase now are not making a move, simply because they do not have the means to even buy a repo home for sale offered at a bargain price. A huge number of Americans have lost their jobs in the past year and most are barely getting by, so a home purchase is definitely out of the question for them. Analysts also stated that the continuous rise in the number of foreclosed properties is scaring some buyers off.

Nationwide housing data showed that recovery varies from one city to another. Those that have high unemployment levels and huge supplies of properties in foreclosure listing are more likely to struggle. A Standard & Poor's/Case Shiller report revealed that 11 U.S. housing markets saw their housing prices decline to their lowest level since the market crisis started in 2007.

Most of these metro areas have huge supplies of bank owned houses; like Las Vegas, Tampa and Miami in Florida, Seattle, Detroit, Chicago and Phoenix. In Las Vegas, for example, prices have gone down by more than 50% last year compared with 2006 levels and houses are now being sold for a price lower than the average selling rate recorded in 2000. Las Vegas has the highest foreclosure rate in the whole country and an unemployment rate of 14.9% as of December 2010.

Real estate experts are predicting that properties in foreclosure listing will rise again this year. Most are expecting the foreclosure crisis to peak in 2011, before starting a recovery in 2012. For areas like Las Vegas though, the recovery is expected to take longer and will probably be slower compared with the rest of the U.S.

Foreclosure Listing Prices Continue to Drop in Major U.S. Markets is a post from: Foreclosure Magazine – Read more about how does foreclosure work.