Tri-Cities cash sales higher than U.S. avg; distressed sales declining


All-cash home sales in the Tri-Cities area were higher than the national average during the first-half of 2015 but followed the national trend lower when compared to the same period last year. Distresses sales in three local counties were higher than the national average during the same period, and they all declined from the last year’s levels.

cash sales 1

All-cash sales declined from the first six months of last year’s share in all local counties except Unicoi and Hawkins.

According to RealtyTrac’s June and Mid-year Home Sales Report cash sales for the January-June period were 28.2%, down from 33.2% during the same period last year.

“As the investor-driven housing recovery faded in the first half of 2015, first-time homebuyers, boomerang buyers and other traditional owner-occupant buyers started to step into the gap and pick up the slack,” said Daren Blomquist, vice president at RealtyTrac. “This is good news for sellers in many markets, providing them with strong demand from a larger pool of buyers.”

Locally existing home sales reach record levels in May and June after a sluggish start during the first quarter of the year. According to the Northeast Tennessee Association of Realtors’ Trends Report year-to-date average prices increased in all but three of the counties tracked in the RealtyTrac report. June’s average prices were a different matter. The average prices for that month were lower in six of the jurisdictions tracked when compared to June last year.

June cash sales

Sullivan and Hawkins saw the share of all-cash sales increase from June last year.

RealtyTrac’s report shows all-cash buyers on the national level accounted for 22.9% of single family home and condo sales in June, down from 24.7% in the previous month and down from 29.1% sales in June 2014 to the lowest share of monthly cash sales nationwide since August 2008. The June cash sales share was almost half the peak of 42.1% in February 2011.

All-cash buyers have played a significant role in the Tri-Cities housing market as evidenced by RealtyTrac’s report. And it’s not surprising to see local investors taking advantage of some good real estate buys. Locally the preference for homeownership is higher than what it is in many of the markets outside of the major metro areas. But even small increases in local rental preference trends and some very affordable existing home prices that are also attractive for home flips present opportunity local individual investors are seizing.

Institutional investors — entities purchasing at least 10 properties during a calendar year — accounted for 1.7% of all single family and condo sales in June in the U.Ss, the same share as in May but down from 3.5% from June 2014. The 1.7% share of institutional investor sales in May and June was the lowest monthly share going back to January 2000.

The local market saw more institutional investor activity during the first half of 2014 than it did this year in all but three local jurisdictions.

Here’s how local institutional investor purchases looked compared to the first six-months of last year:

  • Carter Co. 0%, down from 0.5%
  • Greene Co. 0%, down from 3.8%
  • Hawkins Co. 0.9%, down from 1.7%
  • Johnson Co. 1.7%, up from 0%
  • Sullivan Co. 2%, down from 2.7%
  • Unicoi Co. 0%, down from 3.6%
  • Washington Co. TN 0.9%, down from 2.6%
  • Bristol, VA 1.3% UP FROM 0%
  • Washington Co. VA 1.6%, up from 0%.

Tri-Cities institutional investor purchases in June were 0.7% of the sales in Sullivan County – down from 1.2% June last year – and 1.7% of the sales in Washington County TN – down from 3.7% last year.

Distressed sales — properties in the foreclosure process or bank-owned when they sold — accounted for 8% of all single family and condo sales in June, down from 19% in June 2014 to the lowest monthly share since January 2011 — the earliest that data is available.

Here’s how the report’s June distressed sales look compared to June last year for local jurisdictions:

Carter Co. – 12.2%, down from 24.2%

Greene Co. – 10%, down from 25.8%

Hawkins Co.  – 6.8%, down from 26.1%

Johnson Co. – 5.9%, up from 0%

Sullivan Co. – 2.8%, down from 14%

Unicoi Co. – 11.1%, down from 21.1%

Washington Co. TN – 7.8%, down from 15%

distressed sales

The share of distressed sales declined in every county compared to the first half of last year.

The mid-year tally of distressed sales shows three local counties had a higher share of all sales than the national average. All of the local counties followed the national trend of fewer distressed sales.

The RealtyTrac U.S. Home Sales Report provides percentages of distressed sales and all sales that are sold to investors, institutional investors and cash buyers. The data are derived from recorded sales deeds, foreclosure filings and loan data. Statistics for previous quarters are revised when each new report is issued as more deed data becomes available for those previous months.

Definitions

All-cash purchases: sales where no loan is recorded at the time of sale and where RealtyTrac has coverage of loan data.

Institutional investor purchases: residential property sales to non-lending entities that purchased at least 10 properties in a calendar year.

Distressed Sale: a sale of a property that occurs while the property is actively in some stage of foreclosure (NOD, LIS, NTS, NFS or REO). This includes only sales to third-party buyers or investors not involved in the foreclosure process. It does not include property transfers from the owner in default to the foreclosing bank or lender.

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