January REO sales correlate with November or earlier NOTs.

Much earlier. There seems to be a 2-3 month delay just bringing NOTs on the market. Per Rich’s data there is a 12 month supply of houses on the market. We’ll be optimistic and say that banks are being aggressive in pricing and REOs sit on the market an average of 4 months before selling. Finally let’s say it takes a month for the sale to close.

Adding all together, January REO sales should correlate with June NOTs.