The Federal Housing Administration is selling 11,000 to 13,000 foreclosed homes a month after re-engineering the way it manages and markets REO.
"Monthly sales were as low as 2,725 in December 2010, but rose to an all-time high of 13,609 in June," acting FHA commissioner Carol Galante told a congressional panel.
Until recently, one contractor performed property maintenance, marketing and sales of the agency's REO inventory -- which meant that firm made money if the property sat on the market, but former FHA deputy assistant secretary Vicki Bott decided to divide those functions into three contracts to expedite listings and incentivize sales.
For the first nine months of fiscal year 2011 (ending June 30) the average days-to-list and the average days-to-sell REOs decreased by 76 days (61%) and 25 days (12%) respectively, as compared to FY 2010, according to the commissioner's Sept. 8 testimony
This acceleration of sales has allowed FHA to reduce its REO inventory by nearly 40% in four months.
"As a result of these initiatives and despite the spike in properties being conveyed to us, FHA's inventory of REOs is down to 48,324," Galante testified. The agency had an REO inventory of nearly 80,000 REO at the end of March.
