San Diego Homes

Short Sales on the Rise in San Diego County

Foreclosures maybe on the decline in San Diego County, but short sales are on the incline. A short sale is when a bank allows a borrower to sell their home for less than they owe. Banks costs for a short sale are less than a foreclosure, so banks would rather see a short sale than a foreclosure. Sellers also like the fact that a short sale looks better on their credit record than a foreclosure.

Short sales indicate a weakness in the home sales market, even though they do not show up in the foreclosure numbers. It has been estimated by the California Association of Realtors that sales of bank owned properties and short sales makes up 25% of the homes sold in San Diego County. These ‘distressed properties’ accounted for 44% of the total home sales in June, 2009. The federal government is now encouraging short sales and is actively promoting them as a way of finally resolving the real estate crisis.

Business is brisk for Gary Laturno, a San Diego attorney specializing in assisting debtors deal with lenders. The number of short sales he is dealing with is increasing. Last year his firm completed more than 45 short sales in the 90 transactions with lenders. Already this year his company has completed 34 short sales in 60 closed transactions. Which means he is on track for a 33% increase in this year.

Even though there has been a drastic decrease in the sales of distressed properties in San Diego County, real estate analysts predict that short sales are on the rise.

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