Regular home sellers are facing a losing battle. According to market data, there are over one million repossessed homes on the market, otherwise known a REOs. An REO is a real estate property being sold by lenders, as the homeowners have defaulted on their loans. As the lenders are left holding properties instead of solid funds, they are looking to sell ASAP. For every month their home sits there with residents or a loan payment, the lender is left to pay the insurance, maintenance, and property taxes. According to Trulia.com, most listed foreclosed homes have a value almost 40% lower then normal homes on the market.

Robert Kleinhenz, an economist with the California Association of Realtors, spoke on this growing occurrence in the market, saying "Distressed sales [like foreclosures and short sales] put pressure on the whole market,". For regular home sellers to try and get an edge or at least be even competition wise with these cheap foreclosed homes, they have to lower their value by a great amount, potentially losing any profit or being able to cut even. They also have another option, of waiting to sell, but this is not a great option for those who need to relocate due to jobs, etc.