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I have to say I’m surprised.  BUT I’ll take that!

Last year I predicted a 10% drop in home prices in Silverton Oregon as the supply and demand was so disconnected I really felt the downward pressure would be too great.  Silverton real estate has some good news in that regard.  The average home price corrected 5.3% downward, which is on par with Salem and the median home price went up 5.7%.  Just to be clear the median home price is the price at which 50% of homes sold cost more than that, and 50% were less. It doesn’t mean homes appreciated, but it does mean that Silverton finally started to move some more expensive homes off their market, which had been sluggish.

The Silverton real estate market has even more good news.  One of the things I didn’t anticipate when I made my 10% prediction was a 19.3% decrease in notice of defaults in Silverton.  That’s right, the number of foreclosure notices served in Silverton Oregon went down by 19.3% when compared with 2009.  This is a really, really good thing for the small Silverton market.  The market is still slow, but this huge drop now means better things for the 2012 Silverton real estate market.

The only bad news for the real estate market in Silverton is the number of homes sold.  95 homes sold in 2010 which is down from 2009.  Honestly though, I’m not sure that it isn’t too far off from what should be normal in Silverton.  Silverton due to its size should really be selling about 110-120 homes a year or so there.  So demand isn’t quite where it needs to be, but I think as prices continue to correct a bit more, say another 5% or so, and foreclosures go down, this will go a long way to correctly the Silverton imbalance.

Data was crunched from information provided by the WVMLS and Fidelity National Title Company.

I’ve been busy working and playing at North Fork Park rather than doing my quarterly real estate market reports, so I’m a bit behind…So for those of you waiting for these, my apologies…now onward!

Silverton Oregon home sales

Finally seeing home sales rise in Silverton.  Like the other Salem metro cities, sales stunk in 2009.    Home sales volume in the second quarter was where it was back in the early part of the decade.

Silverton Oregon Average Home Prices

The steep drop in home prices in Silverton has slowed.  This is not unexpected.  Silverton is a nice place to live and as prices come more in-line with consumer expectations prices will stop dropping.  That time isn’t yet though.

Silverton Oregon Foreclosures

Unlike Salem where the notice of defaults are dropping nicely, Silverton foreclosure notices are holding steady.  Not a good thing for the  health of the Silverton real estate market.

My opinion

I think Silverton is in for a bit more pain.  Foreclosures haven’t decreased there which is keeping the distressed property funnel full.  The fact is that distressed properties pull home prices down, so I would fully expect to see ongoing home price declines in Silverton for a while.   I don’t think prices will plunge 20% mind you, but I do think with the large inventory of homes, 12.5 months as of today,  on the market and ongoing foreclosure woes, Silverton has a ways to go before they are done correcting.

If you are wondering what kinds of properties are in foreclosure in Silverton, here they are in the slide show. Check it out and then see what other homes are for sale in Silverton.

P.S.  All home sales and home price data was crunched from the WVMLS and all foreclosure data was crunched from information received from Fidelity National Title Co.

With the kind of ugly nature of the Silverton Oregon real estate market for 2008 and 2009, its not surprising that foreclosures are up a lot here.

Silverton Oregon Foreclosure Rates

This chart shows notice of defaults that were served in Silverton Oregon in 2009, according to Fidelity National Title Co.

In Silverton Oregon, there were 110 notice of defaults served in  2009 compared with the 51 served in 2008.  This 115% increase is one of the worst in the Salem Metro market, barely coming in less than Salem’s 119% increase.  Yuck.

How did that translate into the real estate world in Silverton Oregon this year?

Of the homes (regular single family and acreage properties) listed in 2009 according to the WVMLS,  34 were listed as distressed properties (ie short sale OR foreclosure).  That is 10.8% of listings which is lower than both Salem and Keizer which are over 11%.

The future of distressed properties in Silverton Oregon in my opinion?

Right now distressed properties make up 9.5% of the Silverton Oregon real estate market.  Of potential concern is the large number of default notices, yet the number of active listings isn’t showing as being distressed.  This is potentially concerning because of the large increase in notice of defaults: there should be a corresponding large increase in short sales on the market.  If home sellers have some equity to sell and be able to clear title, then this is a good thing for sellers because they won’t have the foreclosure or short sale ding on their credit.  If home sellers are just not putting their homes on the market, then that is a whole other concern.  Short sales seem to depress real estate values less than foreclosures do since they tend to sell at less of a discount than foreclosures do.  If these homes don’t hit the market as short sales, but rather foreclosures, then home prices will absolutely continue to drop in Silverton.  A 10% drop in real estate values in 2010 in Silverton Oregon is a very real possibility with the current market dynamics.

If you are interested in foreclosures or short sales and want to start watching the foreclosure market, just email me to get on the list.