As more houses are distressed sales, as a percentage of more houses are distressed sales, that’s going to put downward pressure on prices in two different ways. Remember that the first way it’s going to put downward pressure on pricing is the fact that it’s going to take some of the buyers. Some buyers that would buy a non-distressed property are now going to buy a distressed property because they’re getting a discount or they perceive they’re getting a discount. The second way it’s going to impact non-distressed properties is the more distressed properties that sell the more they’ll be used in appraisals. So don’t allow the sellers because they see all of this activity to think that they can now price the house $50,000.00 more.
Almost a million foreclosures are going to come to market this year; 500,000 short sales. That’s going to go ahead and press down pricing. It’s at least going to keep it flat, and we’ll get into a second what experts think on that. And some people are saying well all of this is going to go to the REO it’s a rental program. The government is coming out and going to rent all these real estate owned; these foreclosures. Again, what’s guesstimated is only 100,000 and thank God it’s 100,000. But only 100,000 of the 2.6 million that exist out there, that’s they think is going to be cleared this year, will be cleared through that program. We’re still going to be faced with distressed properties and distressed properties put downward pressure on prices. And we can see now that we’ve bottomed out. This is the percentage of of all properties that the distressed property sales make up. And we can see that it started to fall down in October and now it’s starting to pick up again. I think as we move forward we’re going to closer to that 40 percent mark over the next couple of months. It’ll be interesting to look at that.