Other real estate and certain other assets acquired in foreclosure are reported at the net realizable value of the property, less estimated costs to sell. The following table summarizes foreclosed property activity as of the six months ended June 30, 2021 and 2020:

	June 30, 2021			June 30, 2020
	(Dollars in Thousands)
Beginning balance	$	949		$	1,078
Additions ⁽¹⁾		—			293
Sales proceeds		(142	)		(358	)
Gross gains		56			38
Gross losses		—			(38	)
Net gains		56			—
Impairment		(17	)		(10	)
Ending balance	$	846		$	1,003

Valuation adjustments are recorded in other non-interest expense and are primarily post-foreclosure write-downs that are a result of continued declining property values based on updated appraisals or other indications of value, such as offers to purchase. Net realizable value less estimated costs to sell of foreclosed residential real estate held by the Company was zero and $0.1 million as of June 30, 2021 and 2020, respectively. In addition, the Company did not hold any consumer mortgage loans collateralized by residential real estate that were in the process of foreclosure as of both June 30, 2021 and 2020.

In addition to the other real estate and other assets acquired in foreclosure, the Company also acquires assets through the repossession of the underlying collateral of loans in default. The following table summarizes repossessed asset activity as of the six months ended June 30, 2021 and 2020:

	June 30, 2021			June 30, 2020
	(Dollars in Thousands)
Beginning balance	$	245		$	256
Transfers from loans		515			561
Sales proceeds		(588	)		(270	)
Gross gains		—			—
Gross losses		(67	)		(286	)
Net losses		(67	)		(286	)
Impairment		—			—
Ending balance	$	105		$	261

Repossessed assets are included in Other Assets in the Company’s condensed consolidated balance sheet.