Short Sales

More distressed sales coming to the 2026 housing market

May 6, 2026 By Ryan Lundquist 5 Comments

Distressed sales are back. It’s 2007 again. The market is about to implode. We’re all going to die. That’s what it sounds like online, but do the stats line up with those headlines? Well, there are actually more foreclosures happening today, so we need to talk about this, but the growth has been modest compared to the narrative. Today, let’s talk about what’s happening both nationally and locally with market distress, and consider the future.

UPCOMING SPEAKING GIGS:

5/7/26 Empire State of Mind
5/13/26 Investor Webinar TBA
5/14/26 Event TBA
5/15/26 Nevada County TBA
5/21/26 Event TBA
5/27/26 Solano County TBA
7/1/26 Wisdom Wednesday in Elk Grove
8/6/26 PCAR Auburn
10/2/26 PCAR Rocklin
10/21/26 Coldwell Banker Sierra Oaks / EDH

THIS VIRAL STORY IS CREATING CONVERSATION

The Wall Street Journal pushed out a story this week, and social media is ablaze talking about distressed sales. I think one of the big takeaways is we’re at a six-year high for foreclosures now. That sounds scary, but it also means we’re higher than we’ve been since 2020, which isn’t too crazy since levels have been so low in recent years. However, let’s not ignore an increase, so let’s talk about it. By the way, there are many housing doom prophets claiming victory.

WE’RE NO LONGER AT THE BOTTOM

This visual came from the Wall Street Journal piece, and I think it shows the trend perfectly. Foreclosures are starting to rise, we’re not back to pre-pandemic levels yet, and it’s nothing like the Great Financial Crisis. Ultimately, we’re still really low, but we’re also starting to rise. Both things are true. I find the doomer narrative only focuses on 2020 to 2026, while the rosy narrative ignores any growth lately.

Here’s a HousingWire chart showing foreclosures and bankruptcies. Do you see the difference in rate of growth during the GFC and today? This is a reasonable reminder to not expect 2007 results with 2026 stats.

A GOOD WAY TO DESCRIBE THE TREND

We don’t have a distressed market, but we do have more distress. I think that’s the perfect way to describe the trend right now. Thoughts?

IT’S NOT THE SAME AS 2007

There has been some growth in distress, but the stats also aren’t the same as 2007. These ResiClub charts show delinquencies and foreclosures by state. It’s interesting to see how not every part of the country is exactly the same either (not a shocker). Some areas really didn’t have much carnage back in the day either. I think what would be especially helpful is a chart that shows a baseline for what “normal” looks like in each area so we can better interpret today’s numbers. In California, we’re at 2% now compared to 6.1% in 2007. This sounds close, but think about how bad it was in 2007, and that reminds us there is a big difference between these numbers.

MORE SHORT SALES LOCALLY

Locally, short sales have increased, but it’s been modest. We’re not quite back to 2019 levels, but there really isn’t any place to go but up, so we should see more ahead. Just remember more doesn’t flippantly mean 2008 all over again. Back then we had about 10,000 more active listings, which helped create very quick price change. For reference, there are currently 38 short sale listings in the region and 34 short sale pendings. I have to think there are other properties not formally categorized as a short sale too.

BRO, THERE ARE 1,000% MORE SHORT SALES

It’s easy to get sensational with stats. We could say short sales increased by 22% from one year ago, and it’s true, but there were also only six more short sales. Or we could say there are 1,000% more short sales compared to 2022, but that’s only thirty extra short sales. My advice? Be careful about sensationalism. A common tactic to sound alarming is to share a percentage change when dealing with very few numbers.

MORE SHORT SALES AT FIRST-TIME BUYER PRICES

First-time buyer price points are the primary place where short sales have been occurring. What I mean is 26 out of 33 short sales were under $550K (and 21 out of 33 were under $500K). Citrus Heights has been a standout for more, but I wouldn’t call it an epicenter either since there just aren’t that many short sales happening overall. Mostly, short sales are sporadic rather than concentrated in just one area.

DISTRESSED SALES ARE 1.3% OF THE LOCAL MARKET

In the beginning of 2009, 84% of all sales were distressed in our largest local county, and lately, it’s been closer to 1.3%.

When zooming in, we can see a bit more activity lately, so we’re no longer at the bottom. It’s been a slow burn to see distressed sales hit the market though, and there just hasn’t been an REO tidal wave. Part of me wonders how much we would really see anyway in a climate where institutional investors could buy privately before distressed supply hits the MLS.

FLAT / LOWER PRICES CAN CAUSE MORE SHORT SALES

For many owners, there might not be much equity from a purchase in the past five years since prices have been pretty flat or down a little, and there are definitely people figuring this out as they want to sell. This market dynamic has essentially helped push some homes into a negative equity status. Buyers who purchased with a small downpayment in recent years are more prone to these situations (think FHA and VA). Nationally, we’re seeing the most delinquent loans as FHA and VA too.

YES, SELLERS DO LIST AFTER JUST A FEW YEARS

Who are the sellers today? When did sellers purchase previously? I have some research I’m hoping to push out soon if I can (this takes so much time to pull). Here’s a look at Placer County where 15.7% of all current listings were last purchased on MLS over the past six years. I suspect many listings have equity here, but there are definitely situations where some sellers don’t. This only covers home that sold previously on MLS, so there are also some newly constructed homes that aren’t accounted for here because they initially sold privately from the builder. In short, I would look at 15.7% of listings as solid but conservative. I’ve heard some people say recently that over 30% of current listings were purchased over the past few years, but that doesn’t sound real at all.

AGENTS, PLEASE INPUT DATA CORRECTLY INTO MLS

Friends, please input properties correctly into MLS if they are short sales or bank-owned properties. Accurate data helps everyone, and when stats aren’t accurate, it can lead to an off-base narrative.

BUYERS, DON’T GET YOUR HOPES UP

Be realistic that there are VERY FEW distressed listings right now, so if your plan is to target a foreclosure or short sale, that’s a tiny pond for fishing.

CLOSING THOUGHTS

Overall, it’s NOT a distressed market, but we are seeing some slight growth with distressed supply, and I anticipate more ahead, so we want to continue to watch this. If you’re a consumer who is struggling today, you’re not alone. I know it’s tough to buy something and then watch the market change. I’ve been there before personally. If you work in real estate, expect to see more distress in the market because that’s the trend, but stay grounded in what the stats show. It’s been a slow burn to get more distressed inventory, so don’t expect quick change ahead unless something unexpected occurs. If you’ve never done a short sale too, maybe it’s time to take a class. Moreover, if prices soften more, we should see more short sales ahead. On that note, be sure to major in empathy because some consumers are going to need your understanding and then your expertise. Lastly, for those who peddle fear and conflate 2026 and 2007, why not show actual stats so consumers can form thoughts and make decisions? It gets old when people come to the table with a doom (or rosy) narrative. Yawn.

Anyway, I hope that was interesting. Thanks for being here.

Questions: Are you seeing any distress hit the market? In what ways? What did I miss? Anything to add?

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Who is selling in today’s housing market?

September 4, 2025 By Ryan Lundquist 12 Comments

Who is selling right now? Some say it’s mostly people who bought over the past few years. Others say it’s just Boomers with dated homes. Well, what do the stats show? Let’s take a look at the numbers. I’m focusing on my local market, but I hope you find this interesting no matter where you are.

UPCOMING SPEAKING GIGS:

9/10/25 Windermere Sacramento
9/16/25 Culbertson & Gray (private)
9/18/25 Realty One Group (ROG Talks) register here
9/24/25 Keller Williams Roseville
9/25/25 Further Together (register here)
9/26/25 PCAR
9/30/25 Elk Grove Regional MLS Meeting
10/15/25 EDH Coldwell Banker (private)
10/21/25 Orangevale MLS Meeting
10/23/25 CREB Meeting (TBA)
10/24/25 Fusion Rally in Denver, CO
11/4/25 SAR Main Meeting
11/5/25 KW Elk Grove
12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)
1/14/26 Windermere EDH / Placerville
2/11/26 San Joaquin County presentation (TBA)

DIGGING DEEPER INTO SELLERS

I hope today’s research provides some clues into who is selling. When looking at current listings, how long ago did sellers buy? For instance, 5.0% of current listings previously sold in 2021 on MLS.

Are current listings mostly from people who bought over the past few years?

No, but this is a solid chunk of the market. 18.4% of listings (this also includes pendings) represent homes that were previously purchased between 2020 and 2024 in the region. Don’t get me wrong. This is a very decent portion, but it’s not the majority as some suggest when saying, “Bro, all the sellers today bought when rates were low, and now they need to unload.”

Are owners with low rates holding on to their homes?

Yes. We’re not seeing a flood of these owners, but this portion is definitely growing. Today, there are conservatively somewhere around five hundred listings with a low rate (assuming those who purchased in portions of 2020 and 2021 have a rate around 3%). My sense is people are going to do all they can to hang on to their lower monthly payment, but as time goes on, we should see more owners sell simply because lifestyle and finances will mandate change. Case-in-point. I have a friend who moved to Placer County a few years ago, but now the plan is to move back to Sacramento despite having a sub-3% rate. In other words, it’s not always about the numbers and math. Sometimes lifestyle changes happen, and that’s the trump card. By the way, as these homes come to the market more, we’ll have more conversation about assumable mortgages (only FHA and VA are assumable).

Do sellers have massive equity?

Yes. The vast bulk of listings have ample equity, especially since over half of homes haven’t sold on MLS since 2012. But there are some short sales listings, and these properties represent 0.8% of the market. This is a tiny portion, but if prices persist to decline, we should expect to see this number rise.

Are current listings mostly properties purchased long ago?

Yes, it looks that way. 54.2% of current listings have not sold on MLS since 2012, so the majority of these homes haven’t seen a for sale sign in the yard in quite some time. This lines up with something I’ve been noticing in recent years where many homes are dated and often the byproduct of heirs putting an inherited home on the market instead of keeping it. These homes were often previously owned by the Silent Generation and Boomers. I’m not saying the bulk of listings fall into this category, but there does seem to be a bigger chunk. This could contribute to some listings feeling stale too as many of these homes have not been updated (something that buyers want today). I suppose I could try to pull all sales from 1998 onward in MLS, but this is a tedious process, so I’m only showing 2012 onward today despite the more limited view (this took hours to pull, by the way).

Takeaways for real estate friends:

Who are the sellers? Who has incentive to sell in today’s market? Think about who you are talking to in your marketing. Who are you targeting? Does that line up with what we’re seeing statistically?

DATA METHODOLOGY:

These stats are based on single family detached listings and pendings in Sacramento, Placer, Yolo, and El Dorado counties as of 9/04/2025 (no condos). I compared all of these properties with the addresses of sales from previous years. I used the “Street Address” field in MLS to sort through properties. At first, I used the “Full Address,” but after all my research I realized not every listing had the full ZIP Code listed in MLS, so results weren’t good enough. So, I exported all data again (over 330,000 sales) with just the street address (no ZIP), and it made a difference. I used Excel to identify duplicates, which showed when a current listing was sold on MLS previously. One limiting factor here is there are some current listings that were purchased privately (not on MLS), and focusing on MLS sales only doesn’t capture those properties. This is true of new construction especially that may not have listed on MLS in previous years. So, if anything, consider these numbers reliable, but conservative too.

Thanks for being here.

LEAVING COMMENTS: The captcha is not working perfectly. If you open up a new browser, that should solve the issue. It’s been a problem to comment when clicking from my weekly email. My apologies.

Questions: What stands out to you about the stats today? Anything to add? I’d love to hear your take.

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Five things to watch in the housing market

May 21, 2025 By Ryan Lundquist 16 Comments

Housing is on my mind. Here are five things I’m watching closely in today’s market. I suspect many locations around the country are experiencing very similar trends. I’d love to hear your take in the comments.

UPCOMING SPEAKING GIGS:

5/21/25 Grounded Real Estate
6/5/25 Auburn Marketing Meeting
6/12/25 Realtist of Sacramento
7/22/25 Investor Event (TBA)
9/10/25 Windermere Sacramento
9/16/25 Culbertson & Gray (private)
9/24/25 Keller Williams Roseville
9/26/25 PCAR
9/30/25 Elk Grove Regional MLS Meeting
10/15/25 EDH Coldwell Banker (private)
10/21/25 Orangevale MLS Meeting
11/4/25 SAR Main Meeting

1) MOVE-UP BUYERS MAKING IT HAPPEN

It’s not as easy to be a buyer today since the math isn’t working for so many people, but there are definitely buyers who simply need a different house or location, so they’ll make a move to make things work. Here’s a tweet exchange last week with a local resident. This person is responding to a post where I talked about some counties showing negative price stats. This is a good reminder for real estate professionals to stop obsessing over prices being up (that’s a seller-oriented narrative). The only thing that matters today is finding buyers and sellers who have incentive to participate regardless of market conditions.

We’ve seen more growth at higher prices so far this year. This is about buyers at this range having more money and being less sensitive to rates, but there are surely some move-up situations here too.

2) THE CONDO MARKET IS A DIFFERENT VIBE

The condo market has a different vibe than the detached market. Supply has shown a sharper increase, and we’ve also seen higher cancellations. This is a good reminder that different parts of the market might not feel the same. There are going to be some situations today where prices are declining in the condo market, but detached homes nearby could be flat. Keep in mind not every single condo complex has this exact trend either. What we don’t want to do is impose a “condos are struggling” narrative on all condos. My advice? Look to the comps in each area.

3) SHORT SALES HAVE GROWN, BUT BANK-OWNED SALES HAVEN’T

Short sales have tripled this year, but what that means is there have been 27 so far in the region compared to 9 last year. We could say that’s a whopping 200% growth, but that sounds sensational – especially when we back up for some context to see how many there were a decade ago. No matter what though, we’ve seen growth, so let’s not ignore a trend. I expect to see more short sales ahead as consumers are dealing with growing debt and delinquencies.

It’s not correct to say all distressed sales are growing because bank-owned sales have not grown this year. There has been no wave of foreclosures hitting the market. Let’s keep watching this ahead. For now, it’s best to say short sales have grown, but bank-owned sales have not.

4) NEW CONSTRUCTION IS NO LONGER SUPER HOT

Stats for new homes have been glowing, but that’s no longer the case. April was another lackluster month of new homes sales. Besides 2020, it was the lowest April in a decade locally. When we look at the past 90 days, volume is down 28% from one year ago. That’s 543 fewer sales this year compared to the same time last year. This is a blatant change from recent years, and it’s something we want to continue to watch. It seems concessions aren’t working like they used to.

Two things to watch: Pay attention to builder prices. If builders have more standing inventory, then they’ll have to offer even more concessions or lower prices. The thing I’m curious about is whether we see builders slow down their production. Secondly, watch homes that were built between 2021 and 2024. These units adjacent to current new construction are going to have a hard time competing with the brand-new stuff. Watch pockets with the highest levels of new construction in places like Roseville, Rancho Cordova, Folsom Ranch, and Elk Grove. Some agents are going to become specialists in working with owners who are next to new construction.

5) EXPECT TO SEE MORE CONCESSIONS

The housing market is softer than one year ago, but regardless of temperature, it’s still normal to see more concessions during the second half of the year since there are so many more listings to choose from. Check out the white space that represents July to December. Do you see an uptick every year (besides 2020)? So, expect to start seeing sellers offer more concessions to buyers – especially if rates remain closer to 7%. I can’t verify if this trend exists everywhere, but I have to think it’s going to be common in many markets around the country.

Here’s a look at sales with reported concessions in April in the wider region. Remember, there are two stats here. If nearly 45% of sales had concessions, that means 55% didn’t.

NOTE ON NAR LAWSUIT: Since the NAR lawsuit, it’s very possible that the commission to the buyer’s side is sometimes entered as a concession in MLS. However, in Sacramento County, last April the percentage was 40%, and in 2023 in April it was 41%. So, it’s not that much different today at 45%. The market is softer this year, so we would expect to see more concessions, right? This is something I will continue to monitor. In my strong opinion, we need to keep compensation separate from typical concessions. This helps both agents and appraisers when pulling comps and trying to figure out what sellers are giving to buyers. What sellers are doing for compensation for agents is a separate issue.

Thanks for being here.

Questions: What stands out to you most about the five things to watch? I’d love to hear your take on things.

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The home price crash that hasn’t come

December 10, 2024 By Ryan Lundquist 10 Comments

Real estate prices are going to tank. We’ve been hearing that since 2020, and here we are without much change in most markets. Let’s talk about prices today, and I want to share some new visuals to talk about distressed sales.

Scroll quickly by topic or digest slowly.

UPCOMING SPEAKING GIGS:
12/18/24 Coldwell Banker Sierra Oaks
1/15/25 Mike & Joel Event (free online (register Eventbrite))
1/16/25 Sac Real Producers event (details TBA)
1/22/25 Windermere El Dorado Hills / Folsom (private I think)
1/24/25 PCAR Market Update (details TBA)
1/31/25 Prime Real Estate (private)
2/6/25 She Invests event (TBA)
2/11/25 MLS Meeting TBA
2/18/25 Travis Credit Union TBA
3/6/25 Yolo Association YPN Event
3/12/25 Windemere Sierra Oaks
3/20/25 HomeSmart iCare Realty (private I think)
4/15/25 Culbertson and Gray (private I think)
11/4/25 SAR Main Meeting

PRICES HAVEN’T DROPPED MUCH

Nationally, homes prices haven’t crashed despite so many YouTube videos saying that would happen. So, it seems crash predictions are going to be punted to next year again. The problem is sellers have been sitting back, and that’s really changed the way the market feels. To date, it’s just been too tight for a 2007 level price crash event. For instance, locally this year we’re missing about 11,000 listings from the normal number. Imagine how different the housing market would feel if we injected 11,000 more listings this year. Do you think prices would be declining? I think they would.

From a real estate friend on X:

BUT LOCAL ISN’T THE SAME AS NATIONAL

One thing to remember is there really isn’t such a thing as a national market. The so-called “national” market is comprised of thousands of local markets, and this year national price figures are up, but there are definitely some local markets that are down. Like I always say, the market isn’t doing the same thing in every location, so we want to be careful about imposing a national narrative on every local market. There isn’t such a thing as national weather, and the same is true for real estate.

DID NOVEMBER REBOUND FROM FLAT PRICES?

Local price growth has slowed, and in recent months it’s felt pretty flat. However, price metrics for November are up 4-5% for the region. Has the market rebounded? Well, three things to keep in mind:

We’re now comparing today with a time last year when rates were 8%, so many stats today are simply going to look better.
Square footage in the region was larger in November 2024 compared to last year, whereas the four previous months were lower. This can make a difference in the numbers.
Not every county is mirroring the regional trend of being up.

SIZE MATTERS

I pull stats for nine local counties, and I’ll say it’s hit and miss with size this year. Generally speaking, in counties showing negative price metrics from last year, homes tend to be smaller this year. And in counties with positive growth, homes tend to be larger. Ultimately, I wouldn’t get overly fixated on the latest glowing month unless we start to see a trend.

“PRICES ARE GOING TO DROP BY 40%”

I haven’t seen any reputable data firm say prices are going to tank by 40% in 2025, but I’ve heard that sentiment on X (usually from anonymous accounts). Look, here’s the thing. There is nothing wrong with prices going down, and that would be healthy to create more affordability, but we don’t have enough supply right now to see a massive drop like that. With that said, the positive news for buyers this year is we’ve seen a wider gap emerge between the number of listings and sales, and that has definitely softened the market (see chart). What we want to watch closely ahead is how this gap changes. If it grows wider, that could lead to prices softening, but if it gets tighter, that could leave space for some upward growth. I’ll talk more about this next month in my annual outlook.

BRO, SURFING FORECLOSURE WAVES

I thought it would be interesting to show distressed sales in a new way. I pushed out the first graph last week, and it created quite a bit of conversation.

Only a few distressed sales lately
The carnage after 2007 was vast
The foreclosure market didn’t hit every area the same
Distressed sales were more prominent at lower prices in some neighborhoods. This reminds us the market is NOT the same at every price point.
Higher prices tended to be able to better weather the storm (more equity, more savings, higher income, more cash buyers, etc…).

NOTE: I chose different colors below just to mix it up

DISTRESSED SALES HARDLY EXIST

Very few distressed sales have hit the market lately. That’s what the graphs above show, and stats below show the same thing.

QUICK TAKEAWAYS

Mortgage delinquencies have remained low, but it’s something to keep a close eye on.
We’ve bottomed out with distressed sales, so there isn’t any place to go but up. Having more doesn’t mean 2007 though.
Being underwater on a mortgage is not much of an issue today due to equity, so owners can often do traditional sales to deal with financial carnage.
Let’s not fixate too much on REO and short sale stats because those stats don’t capture the owners who are selling right now due to distressed situations (they have equity to deal with their issues).
Let’s watch rising credit card and auto delinquencies.
Technically, short sales doubled from last year, but there were two this November compared with one last year.

The NY Fed has a great series of charts to show household debt, so check out their latest report here. And check out local delinquency rates from the CA Policy Lab.

And now local stats for anyone interested….

LOCAL STATS

Year-over-year stats. Remember, size matters here. For instance, Sacramento County had 6% larger homes this year, Nevada was 8% smaller, Placer was almost the same, and Yolo was 5% smaller in size. I may add a square footage category as I think it’s becoming more relevant for conversation. Stay tuned.