Approximately 40% Rio Rancho Homes for sale listed in the Southwest Multiple Listing Service are distressed properties. Distressed properties are defined as bank foreclosures or short sale. A short sale occurs when a home owner sells their home for less than they owe the banks. A recent search of the Southwest Multiple Listing service showed there are 721 Rio Rancho homes for sale. There were 94 homes identified as bank owned homes and 194 homes identified as short sales. In most cases bank owned homes and short sales sell for less than market value. This is mainly due to the fact that most bank owned homes and short sales are in need of repairs. Rio Rancho foreclosures and short sales also have a negative impact on the value of all Rio Rancho homes. Many buyers and real estate agents do not like to look at short sales as this process is lengthy and there is no guarantee the buyer will end up purchasing the short sale. So what does all this mean to the Rio Rancho housing market? First, it will be difficult for home prices to rise in Rio Rancho until the number of distressed properties decline dramatically. Second, it will be difficult for home buyers to find good quality homes because the inventory of nice homes is actually quite low. The nice homes that are priced right are going to sell fast as we enter the home buying season. Third, this is good news for home builders. Many Rio Rancho home buyers will look to buy new homes as the selection of nice re-sell homes is low. Rio Rancho homes sold has increased dramatically over last year transaction. Closed transactions in Rio Rancho increased by 43% year over year in March. The average home price increased by 5.9% year over year in March. Homes are selling faster by 6.5% year over year in March. Look for home prices to increase over the next year as the number of distressed properties decline.
The author is a real estate agent specializing in distressed properties and residential real estate.