What's In a Number? Ask the WRA to provide meaning to the numbers

One is not always One in home sales. Sacramento gets it. They're breaking out the distressed sales from the rest. In Madison, WI we're used to a typical sale being a home owner or a builder selling to a home buyer and the home owner is not a corporation i.e. a bank or financial institution.

An Equity Sale is the typical owner to buyer transaction we all grew up with. The Short Sale is the sale where the home owner-seller walks away with no money (maybe still owing some money to someone), and the mortgage company and lien holders are collecting less than 100% of what's owed against the property. REO Sales are the foreclosures. Short Sales and REO Sales are Distressed Sales.

This pie chart shows that Sacramento's Equity Sales are outnumbered in a big way by the Distressed Sales. Compare the total number of sales in this pie to total number of sales in a previous year and you might conclude that the total numbers look pretty good. Breaking the numbers out by Short Sale, REO and Equity Sales  we can see more clearly that the current numbers indicate a market made of aluminum and not steel...the numbers have too little substance. A foreclosure vacated house is probably not adding another buyer to the economy. The short sale is likely the same---one sale with no additional money going into the economy.

OK Realtors remember--I don't care if you think I am not "optimistic". I care that I am realistic and focusing on accurate information to help people make informed, not hopeful, decisions. I know a short sale and REO sale probably does pay a broker fee, so a sale is a sale when counting money paid to the realtors, title company, and lender. But the health of the market is what we are trying to get a handle on. If someone asks if the market will be "better" in the spring, we need to have some facts to base our opinion and "I hope so" is not an acceptable response. Numbers that show equity sales rising and distressed sales decreasing is a sign that the market is moving forward, not grinding.

wra@wra.org is the email to send a request to the Wisconsin Realtors Association to request this information be compiled and made available by county.