The impact of distressed sales (bank owned, short sales) on the Harrisonburg, Rockingham County housing market

Housing markets across the country have been affected by an increase in distressed sales over the past few years -- both bank owned homes (that were foreclosed on) and short sales (where the sales price didn't pay off the mortgage).  So, what was the impact in our local area?

A few observations based on the data above....

1. Distressed sales increased significantly (+ 38%) between 2010 and 2011.  Thankfully, the number of foreclosures declined (- 17%) between 2010 and 2011, so we are likely to see fewer distressed sales in 2012.
    
   
2. As could be expected, distressed sales made up a larger portion of home sales in 2011 (14%) as compared to 2010 (10%).  This marks a 35% increase in the percentage of local home sales that were distressed sales. 
     
   
3. The median price of distressed sales declined by 15% over the past year.  This may have been a combination of better deals on distressed properties and/or lower valued homes being sold as distressed sales.
    
   
4. Thanks for reading to this last point, because this is the important one!  While the overall median sales price in our local area declined 3% over the past year --- if you take out distressed sales, the median sales price only declined 1%.

Again, given the decline in foreclosures in 2011, I am hopeful that we'll see a smaller number of distressed sales in 2012, leading to greater stability in our local housing market.