Pro Teck Valuation Services’ released it October Home Value Forecast Update, which includes a listing of the 10 best and 10 worst performing metros as ranked by its market condition ranking model. Top areas on the list for October include Modesto, Santa Rosa and Los Angeles Calif., the company announced in a press release.
“It’s hard to sustain a market turnaround when 25-50% of sales are foreclosures. When foreclosures represent a significant share of total sales and their discounted prices pull down the prices of non-distressed sales, it is known as the ‘contagion effect.’ This month, that’s what is happening in or bottom ten metros, which also happen to be in judicial states,“added O’Grady. ”Even though other market fundamentals are looking good, such as recent price appreciation and shrinking inventories, foreclosures are still playing a major part in holding these real estate markets back. A stable market cannot return until foreclosures play a less active role in the market.”