RealtyTrac reported that the Los Angeles metro area had 9,145 short sales in the quarter, a full 25 percent of all sales. Phoenix had 8,434 short sales, 23.4 percent of all transactions.
Short sales are an ideal way for investors to get into properties at a discount, since they involve a lender accepting less than what is owed on houses to avoid going through a foreclosure. The only major drawback is that it can take much longer to negotiate a short sale than a regular transaction, with the process often taking months instead of weeks.
Among the nation’s 10 biggest short-sale markets, the average savings on a short sale was between 21 percent and 41 percent. Nationwide, short sales grew by 19 percent in the second quarter, to 102,407. They made up 12 percent of all residential home sales in the period.
Here are the top 10 short-sale markets, as reported by RealtyTrac, with the total number of short sales, the average savings off the value of the property and the average price paid in the transaction:
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