Distressed Sales Hit Lowest Share for May Since 2007

Distressed sales in the United States accounted for 9.9% of total homes sales in May 2015, the lowest level for the month since 2007, reported CoreLogic Thursday. The figure represents a 2.8% drop from May 2014. CoreLogic, a property data provider based in California, forecasts that if the year-over-year decrease keeps its current pace, the share of distressed sales would reach the pre-housing crisis "normal" of 2% in mid-2018. At its peak in January 2009, distressed sales represented 32.4% of all real-estate transactions. Distressed sales include real-estate owned and short sales. In May, Michigan had the largest share of distressed sales of any state at 21.4%, followed by Florida (21.3%) and Maryland (20.3%). On the other end, California showed the largest improvement, with its sales share falling 58.1% from its January 2009 peak of 67.5%. Areas in Florida—including Orlando, Miami and Tampa—had the largest share of distressed sales. More: Cash Sales Continue to Decline in U.S. The Miami Association of Realtors sees signs of improvement. "Back in 2008, maybe two-thirds of our sales were distressed sales, now it's 21%," said Lynda Fernandez, senior vice president of public relations at the association, noting also that currently only 8% of properties listed in the Miami area are short sales or REO. According to data compiled by the Miami group, foreclosure court filings in Miami-Dade County went down from 11,548 in the first half of 2013 to 5,031 in the same period in 2014, a 56.4% year-over-year drop. Through June, foreclosure filings decreased 31.2% in 2015, to 3,461. Distressed sales could be difficult for many homeowners, particularly foreign buyers unfamiliar with the process. Fernandez said that the Miami Association of Realtors educates its members to help clients in this situation. Florida accounts for 21% of all home sales to foreign buyers, more than any other state in the country, according the National Association of Realtors. Distressed properties represent a bargain opportunity for real estate investors and they tend to go off the market fast, said Fernandez. Still, while foreign buyers do acquire existing homes, they generally tend to prefer the new condo buildings. Write to Andrea López Cruzado at andrea.lopez@dowjones.comFollow Mansion Global on Facebook, Twitter and Instagram