I had occasion a couple of weeks ago to do some digging for Short Sale listings in West Bellevue - the area west of I-405 and north of I-90 including Beaux Arts, Enatai, Medina, Clyde Hill, plus Hunts Point and Yarrow Point on the north side of Hwy 520.  As a refresher, in a Short Sale an insolvent seller is trying to avoid foreclosure by selling the property and getting the lender to accept less than is owed on it.  So now there are three parties to the deal, and at least one is not happy - that lender approval process is often slow and uncertain.  (more on Short Sales)  I have heard that Short Sales may now be 20% or more of our current sales activity, but we don’t have an easy way to track them separate from regular sales.  While 20% short sales is way better than the 50% we hear about in some of our more unfortunate sister cities, it still is more than enough to effect prices – after all, the Seller has to push the price down enough to get a deal before the foreclosure clock runs out.  The Seattle Times had a pretty substantial article on short sales this past weekend.

In that west Bellevue area there were 313 active listings for single family homes.  I scanned through the agent summaries for each looking for “subject to lienholder approval” or some similar phrase.   I found 32 listings that were short sale, about 10% of the total, and 5 that were bank owned, less than 2% of the total.  So, as we sensed, there are quite a few short sales going on, and they have been affecting prices.  As a side note, the number of condo short sales in this area is very low, and I did not track it further.  That happy state may not reflect the travails of the builders of all the new condo towers in Bellevue – they may be unable to use the short sale process on unsold units in the way that individual condo owners can.   

Some other interesting observations out of this little study - this is a relatively high-priced area: 68% of the listings are over $1 million.  But 67% of the short sales are under $1 million.  Short sales are part of what is pushing the lower price range inventory down, just as in other parts of the country.

And last of all, in the past two and a half weeks 14 of those shorts have gone under contract (MLS status = Pending) and 1 more has closed (MLS status = Sold) - sounds like a pretty hot absorption rate to me

Chuck Reiling

www.ReilingTeam.com