The Herald Tribune reports from Florida. “David and Heather Hash are like many who bought homes at the height of the housing boom: Now, looking to sell, they find they owe more than their house is worth. Their three-bedroom, two-bath house, which they bought in 2004 for $337,000, has been on the market for eight months — now listed at $325,000 — without a single offer.”
“‘We’ve had a lot of heart-to-heart talks with our Realtor, who has checked with other Realtors to make sure it’s priced right,’ David Hash said. ‘The house is in good shape, but with the inventory out there, we’re not getting anyone coming through.’”
“They are not headed for foreclosure. They are not even behind on their payments. They have a second child on the way and had wanted to move. To Hash, it feels like financial options for homeowners in trouble are the most abundant for those who have behaved the least responsibly.’
“‘What’s frustrating for me is the people getting the help are the high-risk borrowers and lenders who knew what they were getting themselves into,’ he said. ”And now they are going to pretty much get bailed out.”
“Joe Murphy, a Coldwell Banker Residential Real Estate agent, says he is ‘neck deep’ in short sales in Manatee County. ‘It seems like everything we show right now are short sales or foreclosures,’ Murphy said. ‘Short sales have been getting better and easier to deal with in recent months as the lenders have been more cooperative.’”
“‘A year ago I would dissuade someone upside-down in their house without a real hardship from a short sale,’ he said. ‘Now all bets are off.’”
“Murphy recounted a recent successful short sale in which the seller was not behind in payments and had investments that could have been liquidated to pay the difference, yet the bank still wrote off $100,000 when the property sold.”
“‘The banks don’t want the houses back,’ he said.”
“Mary Kleiss missed a mortgage payment for the first time in her life in June. Now she has missed July’s, and expects to soon lose the house she has lived in for 30 years.”
“The death of her husband two years ago started a chain of events that pushed Kleiss into a financial crisis. It culminated with the loss of her job in February, just before she saw a spike in her flood insurance.”
“‘I’m heartbroken to walk away from this home; I see the plants that Joe and I put in in 1991,’ Kleiss said. ‘Whatever Joe did I would like to take with me. Not the new stuff, the memories.’”
“Kleiss is among a growing number of traditionally self-sufficient people plunged into a new world by the steep economic downturn. They are skipping their mortgage payments, standing in line at food banks and reaching out to social service agencies for emergency aid.”
“The house will not fall into foreclosure until she misses four payments, something she cannot imagine avoiding, even with assistance. So, she is planning now to move into an apartment complex where the rent will be cheaper than a mortgage.”
“‘I’ll just walk away. I have no choice,’ Kleiss said.”
From The Ledger. “Polk County has never seen this many foreclosures, at least not in recent memory. In June, 815 foreclosures were filed with the Clerk of Courts, up 114 percent from the year prior and the highest monthly sum in county records dating to 2002.”
“The filings – primarily residential but also commercial properties and land parcels – totaled nearly 4,500 through the first six months of the year. Polk had roughly 5,100 in all of 2007.”
“‘This is not just sub-prime people, people with bad credit. Foreclosures are hitting people within all income brackets,” said Janet Folkerts, financial counselor. ‘They’re not all deadbeats. They’re people living the American lifestyle to the extent of their paycheck. It didn’t take much for them to go under. When I have people in my office that have over $10,000 a month in income and can’t make it, that tells you something.’”
“Tallahassee-based nonprofit group Florida Legal Services says there are now some 77,000 homeowners in foreclosure, second only to California.”
“‘The increase is shocking,’ said John Corbett, president and CEO of Winter Haven-based CenterState Bank. ‘It’s a six- to eight-month process from when foreclosures are filed to when the bank can take possession. What that tells you is a wave of homes are probably going to come on the market in the fourth quarter of this year and the first quarter of next year, and that’s going to continue to put downward pressure on prices.’”
“Corbett attributes the tide of foreclosures largely to investors bailing out as median home values continue to plunge.”
“‘Having said that, with depreciating home values and increasing fuel costs – which affect everybody – there will be a squeeze that we have not experienced for the past decade. People have been living off the equity of their homes as part of their lifestyle, and that extra cushion has gone away,’ he said.”
The Orlando Sentinel. “With mortgage foreclosures still on the rise across Florida, downward pressure on home prices is expected to continue at least through the end of this year and possibly much of 2009.”
RealtyTrac said Thursday that 40,351 residential properties in Florida were foreclosed on by lenders in June — second only to California, which had nearly 67,000 filings. Florida’s foreclosure total was nearly double the volume of a year ago.”
“Real-estate professionals in the Orlando area contend that both single-family home and condominium sales are healthier locally than many people think.”
“‘My father and I have real-estate projects all over Central Florida. My cousins and uncle have real-estate developments in South Florida. My projects in the south Eola district of Orlando are the strongest in the entire portfolio,’ said Orlando-based condo developer Steve Kodsi. ‘In fact, if we only had the Sanctuary and Star Tower [condominiums], we’d be having a profitable 2008.’”
From Canadian Business. “Attention, real estate shoppers: the entire U.S. sunbelt is now officially on sale. Prices in many areas of Florida, Arizona, Nevada and California have dropped 40% from their peaks of a couple of years ago, to the point where the deals seem nearly too good to be true.”
“In Naples, Fla., a three-bedroom, two-bathroom home that sold for $350,000 in 2007 is on the market for only $200,000. A starter home in Sacramento, Calif., that sold for $215,000 in 2004, is on offer for a mere $129,000. And remember: these aren’t sale prices. They’re asking prices.”
“Sandra and Pat Parente of Richmond Hill, Ont., scouted condos in Fort Lauderdale, Fla., in March of this year. Their eyes lit up when they saw a handsome two-bedroom, two-bathroom unit only steps from the beach. It had been listed this past October for $239,000, but had since been reduced to $199,000.”
“‘My immediate thought was, ‘Wow, this is fantastic,’ says Sandra. ‘It needed a bit of sprucing up, but there wasn’t anything that needed urgent attention. It had a green area all around it, and a pool, and we saw it as a great way to get into the Florida market.’”
“The Parentes’ wariness is justified, say real estate experts. Many believe we’ve seen just the beginning of a monumental real estate collapse.”
“‘The size of the U.S. real estate bust on the way down will be proportional to the size of the real estate boom on the way up,’ says Robert Campbell, a real estate economist in San Diego, Calif. ‘There’s no slowing down this train. The areas that had the biggest booms will have the biggest bust. Prices are heading lower – way lower.’”
“‘Believe me, the real estate community is biased and will encourage you to buy, even as prices keep falling,’ says Campbell. ‘You have to avoid that.’”
“In the Miami-Fort Lauderdale area, the supply of single-family homes and condominiums for sale is enough to last for 34 months. The backlog is 21 months in Orlando, 18 months in Tampa and Las Vegas, and 14 months in Phoenix. Meanwhile, even more units are coming on the market as builders finish the projects they started in better times.”
“‘Builders are offering huge incentives and lease-back programs,’ says Mark Dziedzic, president of a real estate firm that specializes in helping Canadians buy second homes in Arizona. ‘Here in Arizona, some will guarantee you rent of $1,500 a month for two years on any property you buy, while others offer huge discounts on sale prices. The competition is tremendous.’”
“‘I know Canadians will be saying to themselves ‘look what we pay here in Canada’ and compare it to what they can get in the U.S.,’ says Campbell. ‘But don’t look at prices relative to where you are. Instead, look at prices relative to where the real estate market is in the U.S.’”
“Ann Bosley recently bid on an 1,800-sq.-ft. condominium in Hilton Head, S.C., that comes with maintenance and security included.”
“Bosley says her search for a U.S. property taught her never to think that any offer is too low. ‘Nobody is bidding the asking price on any property right now,’ says Bosley. ‘In fact, U.S. real estate agents are advising clients to bid 20% under the asking price, then take off extra for necessary reno costs.’”
“Canadians Sandra and Pat Parente, have put off buying a U.S. property. In April, the Parentes received a phone call from their Florida real estate agent informing them that the seller of the condo in Florida had reconsidered and would accept their $175,000 offer if they wanted to resubmit it. The couple chose not to.”
“‘We’ve reconsidered as well,’ says Sandra. ‘I’m reading every day about more foreclosures happening in the next few months and I think we need to do more research on taxes and rental issues. When we finally buy – which we’d love to do eventually – it will be with our eyes wide open.’”
