San Antonio Business Journal by Mike W. Thomas, Reporter
Date: Thursday, December 6, 2012
Short sales of U.S. homes were up 35 percent during the third quarter compared to one year ago as homeowners and banks anticipate the end of a tax break on forgiven principal.
Barring a last-minute extension of the 2007 Mortgage Forgiveness Debt Relief Act, homeowners will be taxed on the forgiven principal from a short sale starting next year. Short sales, when a home is sold for less than the amount owed, have accounted for as many as 1.1 million transactions since 2009.
Short sales are better for the real estate market than sales of bank-owned properties, says Daren Blomquist, vice president at Renwood RealtyTrac LLC. The average price for a short sale was $186,000 in the third quarter, compared with an average bank-sale price of $161,954.