Foreclosures approach 25% of the housing market: Zillow
Sales of homes foreclosed on in the previous 12 months made up 24% of the market in April, up from 16% one year ago, according to data compiled by Zillow. It's the 10th straight month of increases and yet another record high. There are still plenty of properties either in foreclosure or on the verge of it. Recent data puts the number of this shadow inventory at roughly 4.5 million. And as these properties take more and more of the market share away from new or traditional sales, losses continued. In April, 37.2% of homes sold for less than the previous purchase price, down only 1 basis point from the previous month and still 30% higher than one year ago. The value of these homes fell as well, dropping 0.77% from the previous month and 8% from one year ago. However, Zillow Chief Economist Stan Humphries said values didn't drop as far as they did between in November and December – a 0.89% dip – signaling some improvement in the trend. A disparity between which homes are losing value continued in April. The most expensive one-third of homes in each market lost 0.74% in value, while the least expensive one-third of homes lost nearly a full percentage point in value. A recent study from Altos Research showed signs of a volatile housing market for some time to come. Humphries adds the April data shows depreciation rates are improving in the Spring but not quickly enough to reach a bottom this year. JPMorgan Chase (JPM) analysts recently pegged a new bottom for home prices for the summer of 2012. "Key drivers at this point are the pace of foreclosures and improvement in the employment picture," Humphries sad. "The latter, in turn, will boost household formation and consumer confidence." Write to Jon Prior. Follow him on Twitter @JonAPrior.