Sonoma County REO Average Sales Price
Sonoma REO prices have dropped almost 10% in the last months of 2010. July and August were solid months with average Sonoma REO prices right around $300,000. The last three months have been closer to $270,000 , a cliff drop of almost 10%. I think the timing of this relates very closely to the timing of the announcements about foreclosure fraud and the robo-signing problems that caused temporary halts to REO sales in all 50 states.
Sonoma REO Sales Volume
What’s interesting from a buyer’s point of view is that the price drops haven’t been accompanied by any reduction in the market volume for bank owned homes in Sonoma County. Instead, in direct contradiction to the traditional annual slow down of residential sales, the REO market has actually picked up volume since the end of summer. Both September and November are higher than July and August. That’s not a result I would have expected.
Between the price drop and the steady volume, we have two contradictory measures of what the market is doing. Normally a price drop would be accompanied by a reduction in demand (or be a result of it). What we are seeing instead is both growing demand and falling prices. I will post more about the overall market after we have had a chance to look at all of 2010. I think we’ll have some interesting relationships among REO, short sale, and open market sale properties in Sonoma County.