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Foreclosures and Listings of Bankruptcy Houses Cause Prices to Dip

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By : John Cutts    99 or more times read
As the number of properties falling under listings of bankruptcy houses and foreclosures increases in the state of Washington, the price of residential properties also declines. Analysts stated that this is to be expected since housing prices are correlated with market supplies. Data for November 2010 showed that prices in several areas of the state declined to new record lows.

Median price of properties in foreclosure listings in Bellingham and other types of residential structures in various areas of the state declined for the month. In King County, the median price of single family dwellings for November was $359,950, representing the lowest price level in the area in over five years.

Since July 2007, prices of Washington foreclosure homes and other residential structures have dropped by over 25%. However, despite recording a new price low in November 2010, the median price is merely 2.7% lower than the median price of dwellings recorded a year ago. Most housing experts are predicting further decreases in home prices until the middle of 2011.

They stated that continuous growth of listings of bankruptcy houses and foreclosed dwellings will keep housing prices at low levels until next year. They also reveal that high-end residences account for a high percentage of housing sales in most Washington areas, thereby preventing median prices from hitting extreme lows.

Local realtors have reported that the only reason some buyers are opting for high-end properties instead of a foreclosure home is because sellers are offering these luxury homes for heavily discounted prices. Despite bargain prices though, the number of houses sold continue to decline in major areas of the state.

In King County, a total of 1,092 residential purchase closings were made in November, translating to a 31% drop when compared with November 2009. Industry analysts have explained that the decline was expected since sales recorded a year ago were artificially inflated by the government's tax credit program. Condominium sales also reflected the artificial impact of the tax credit initiative.

King County condominium sales performed even worse than single family dwellings in terms of sales, analysts have reported. With numerous foreclosures and listings of bankruptcy houses to compete against, condo unit sales declined by 47% when compared with November 2009. Prices of condos also dropped by 11% to $225,000.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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