Short sales, REOs and foreclosures. We sure have been hearing those words more often lately than we did for the last 10 years or more. Unfortunately, we’ll continue to hear them for many months to come. Some experts predict another 18 months of these types of real estate sales before we see them, for the most part, come to an end. Well, at least not here in Marin, right? Wrong. Unfortunately, Marin is not exempt from the real estate downturn. We are more protected than the majority of California and the rest of the country, but we are seeing plenty of short sales, REO, and foreclosures.

As of August 20 there were 1120 active listings of single family homes and condominiums/townhomes throughout Marin County. Of those listings, 203 were either a short sale, REO or foreclosed property ranging in value from $171,900 to $1,398,000. Those 203 listings account for 18% of Marin’s current inventory. That means that almost 1 out of every 5 listings is a financially distressed property.

Of the 776 sales since May 1st, 107 of them were either short sales, REOs or foreclosed properties. Those sales ranged in price from $144,500 to $1,162,500.

The overwhelming majority of these listings and sales have been properties in San Rafael and Novato. Those towns (at least parts of those towns) have seen and will continue to see declining property values. Whenever distressed properties are being sold in large numbers in any given neighborhood they set the value for future sales. The appraisers then use these lower sales prices to determine the value of upcoming sales. Hence, the declining values.

However, it may be a costly mistake for buyers to think that by staying on the sidelines and waiting to purchase until prices go down. The other part of the equation that must be factored in are mortgage interest rates. Even if a potential buyer might see a 4% drop in asking prices, they may also see a .25 or .5 point increase in mortgage rates, thereby negating the slight drop in home prices.

Whether you’re a potential home buyer or home seller it is important for you to know how your real estate market is performing before making a decision. As you can see, each area of Marin and even areas of the same town are performing differently. Your decision should be based on real estate information pertinent to your property, not information based on the overall market or the nationally reported real estate news.