OREO and Other Repossessed Assets

The following table presents the activity related to OREO and other repossessed assets for the years ended September 30, 2017 and 2016 (dollars in thousands):



	2017					2016
	Amount			Number		Amount			Number
Balance, beginning of year	$	4,117		23		$	7,854		35
Additions to OREO and other repossessed assets	751			4		307			4
Capitalized improvements	—			—		142			—
Writedowns	(42		)	—		(435		)	—
Sales of OREO and other repossessed assets	(1,525		)	(11	)	(3,751		)	(16	)
Balance, end of year	$	3,301		16		$	4,117		23

At September 30, 2017, OREO and other repossessed assets consisted of 15 OREO properties and one other repossessed asset in Washington, with balances ranging from $13,000 to $948,000. At September 30, 2016, OREO consisted of 22 OREO properties and one other repossessed asset in Washington, with balances ranging from $6,000 to $957,000. The Company recorded net gains on sales of OREO and other repossessed assets of $54,000, $47,000, and $110,000 for the years ended September 30, 2017, 2016 and 2015, respectively. Gains and losses on sales of OREO and other repossessed assets are recorded in the OREO and other repossessed assets, net category in non-interest expense in the accompanying consolidated statements of income.

At September 30, 2017, the recorded amount of foreclosed residential real estate properties held in OREO as a result of obtaining physical possession was $875,000 and the amount of one- to four-family properties in the process of foreclosure totaled $100,000.