Unlike previous housing booms, this isn’t a traditional seller’s market buoyed by rising prices or reduced supply. Today, bank-owned properties and so-called “short sales” drive the market — both types commonly called distressed properties in the real estate industry. A short sale is when the lender agrees to list a property for less than what the homeowner owes on his or her mortgage.
Multiple Listing Service statistics, which track every home on the market, show that 75 percent — 239 of 317 — of the Napa County homes or condos currently under contract are distressed properties, such as bank-owned homes or short sales.
Additionally, 57 percent — 73 of 129 — of Napa County properties closed in the past 30 days were “distressed” properties.
Meanwhile, the pipeline of distressed homes remains full.
DataQuick statistics show that Napa County notices of default increased 6 percent in the second quarter of 2009 compared to second quarter of 2008. A notice of default marks the first step in the foreclosure process. But during the same period the number of trustee’s deeds recorded, the final step in a foreclosure, decreased 30 percent.