One-third of existing homes sold in Spokane during February were distressed sales – and despite that high number, the market average price and median price increased compared to January.
Distressed homes are those sold in foreclosure or sold by owners eager to unload property worth less than they owe.
Normally distressed sale prices are lower than the market average as the owners cut their losses.
But Spokane’s median sales price in February grew 3.8 percent from January and 3 percent from one year ago, said Rob Higgins, executive officer with the Spokane Association of Realtors.
Spokane had 288 homes sold in February, a drop from the 295 sold in February 2013.
Forty of the 288 were new homes. The rest included 83 distressed sales, which is up from 77 in February 2013, Higgins noted.
That’s two months in a row, he added, noting January’s distressed sales came to 80, compared with 58 in January 2013.
“It’s possible that the banks are just being more aggressive in selling off that distressed inventory,” he said.
Interest in distressed homes could also signal heightened interest by investors for homes to resell later or convert to rentals, he said.
Also for the second straight month, the Spokane market saw the highest number of resales occurring in the city of Spokane’s northeast neighborhoods, according to the Realtors association. February’s 36 resales in that area had a median sales price of $65,000 – well below the county’s median of $157,750, Higgins said.
“Either it’s people getting starter-uppers as they become first-time homeowners or we’re seeing investors looking for affordable homes to use as rentals,” he said.
Even though the total increase in home prices is modest, Higgins said, “it’s still an increase, and it can only help as we go through the rest of the year.”