If you want to buy a distressed property in Park City, you probably missed the boat.
Distressed Sales Defined
What is a distressed sale? A distressed sale is either a foreclosure (bank owned property) or a short sale (the seller owes more than the property is worth). Another name for foreclosed properties is “Real Estate Owned”, or REO. It’s a term used by banks to describe real estate vs other assets that they own, such as cash.
These two categories of listings are declining in the US and have plummeted in Park City. According to the National Association of Realtors, distressed homes accounted for 11% of U.S. sales in May, 2014, down from 18% in May, 2013. Foreclosures sold for 18% below market value and short sales were discounted 11%.
Distressed Sales in Park City, Utah
In Park City, the story is very different. During the worst of the economic downturn, distressed properties accounted for nearly 40% of sales in Park City.
During the second quarter of 2014, distressed properties accounted for only 2.8% of sales in the Park City area, down from 5.3% for the second quarter of 2013. Distressed sales this past quarter were discounted less than 2% from market value.
There are still some great values in Park City. Median home prices are about the same as they were in January, 2006, which is still significantly lower than the peak in 2008. Deaths, divorces and relocations sometimes force owners to sell their properties for below market value. These great deals are a bit more difficult to find but are still out there.