Select the search type
  • Site
  • Web
Search
Register   |  Login   |  Contact Us | About Us | Site Map
Become A Fan On The Condo Vultures Facebook PageFollow Us On The Condo Vultures Twitter PageWatch All Our Video Content on the Condo Vultures Youtube PagePeter Zalewski of Condo Vultures Linked InTake Our News To Go. Condo Vultures RSS Feeds. Society of Professional Journalists investigative reporters and editors
Return to Condo Vultures front page

Bank Repos Increase By 13% In South Florida Market In Q1 2012
Bank Repos Increase By 13% In South Florida Market In Q1 2012
Published on 4/10/2012 6:05:00 PM

Bookmark and Share


For the first time since the South Florida real estate crash began in 2007, lenders have repossessed more than 10,000 properties in the first quarter of a year in the tricounty region of Miami-Dade, Broward, and Palm Beach, according to a new report from CondoVultures.com.    

Lenders armed with the foreclosure process forced a change in ownership of nearly 10,200 properties in South Florida in the first 90 days of 2012 compared to less than 9,000 repossessions in South Florida in the same period in 2011 and nearly 9,200 repossessions in 2010, according to an analysis based on Clerk of the Court records in Miami-Dade, Broward, and Palm Beach counties. 

In the first quarter of previous years in South Florida, lenders repossessed 7,300 properties in 2009, nearly 4,800 properties in 2008, and less than 1,400 properties in 2007, according to government records.   

"More than 165,000 properties in South Florida have changed ownership forcibly in South Florida since the first year of the real estate crash in 2007," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures® LLC. "We expect this total to grow in future quarters as more than 300,000 notices of default have been filed against South Florida properties to date. The unanswered question is when are the lenders going to put the bank repossession on the resale market for purchase." 

As of April 11, 2012, less than 1,600 bank-owned residential properties are on the resale market in South Florida, according to an analysis by the licensed Florida brokerage CVR Realty™.  

The bank-owned residential properties represent less than five percent of the total number of condos, townhouses, and single-family houses on the resale market in South Florida, according to the analysis based on Florida Realtors association data. 

At the current first quarter of 2012 repossession velocity, lenders are on pace to force a change in ownership of more than 40,000 South Florida properties this year. 

The year 2010 ranks as the busiest 12-month period in recent memory in South Florida for lender repossessions with more than 54,400, according to the report.     

Compare this to 2011 when lenders repossessed less than 35,000 properties in Miami-Dade, Broward, and Palm Beach counties, according to government records. 

Previously, lenders repossessed more than 30,400 properties in 2009, nearly 26,250 properties in 2008, and about 10,100 properties in 2007 in the tricounty region, according to the report.

Administrative irregularities in the repossession process first surfaced in late September 2010, creating a "foreclosure freeze" that prompted many lenders to slow the number of defaults being initiated against borrowers in South Florida between October and December 2010 compared to the same three-month period in 2009. 

The slowdown in the foreclosure filing process continued throughout 2011.   

In February 2012 after months of negotiations, the nation's five largest mortgage servicers cut a deal with the federal government and the attorneys general from 49 states to provide at least $25 billion in relief to borrowers. 

It is unclear what impact the National Mortgage Settlement Agreement will have on foreclosure filings going forward in South Florida. 

The settlement agreement incentivizes the mortgage services to consider various options – including principal reductions, mortgage modifications, and shortsales - before filing to foreclose on borrowers who owe more than their residences are worth currently, according to the agreement.

Even before the concerns about the legality of thousands of bank repossessions surfaced in the second half of 2010, lenders had already started to slow their foreclosure efforts due to the rising costs and difficulty involved with repossessing properties from borrowers in default.  
 
Prior to the real estate crash, lenders generally expected the foreclosure process to take about six months to complete at a cost of about $40,000 in loss of debt service, unpaid taxes, damage, court fees, and attorney costs. 
 
With nearly 310,000 notices of default filed against borrowers between 2007 and the first quarter of 2012, the South Florida court system was overwhelmed with foreclosure actions, according to the Condo Vultures® Foreclosure Database™
 
In South Florida today, lenders now plan for a 700-day repossession process with a cost of about $100,000 per property, industry watchers said. 

In the end, bank-owned properties offered on the open market generate a lower average price than properties that are sold as shortsales. 

In 2011, the average transaction price for a South Florida condo or townhouse shortsale was $113,100 compared to $92,50 for a bank-owned condo or townhouses, according to Florida Realtors association data. 

The strategy shift by the lenders has led to a 12 percent spike in condo and townhouse shortsales, reaching more than 11,350 transactions in 2011. In previous years, condo and townhouse shortsales totaled 10,100 in 2010 and 5,550 in 2009, according to a CondoVultures.com report.

Condo and townhouses transactions that were never listed on the Multiple Listing Service are not included in this report.  

It is important to note there are various stages to a residential real estate transaction in South Florida.

A transaction begins when a property is made available for sale and ends when a title is conveyed from one party to another party as a result of the recording of a deed with the local government. 

As part of the process, a property typically goes under contract and into a due diligence phase by which a deal can be canceled.  

Condo Vultures® LLC is a real estate consultancy and marketing company based at 1005 Kane Concourse, Suite 205, Bal Harbour, Florida, 33154. You can reach Condo Vultures® LLC at 800-750-0517.

Don't forget to sign up for our weekly Market Intelligence Report™ for detailed condo reports to stay informed on the latest market trends and to find out about our various Condo Vultures® Seminars. Looking for a property at a deep discount? Take a peek at the Vultures Database™ or view our Video Library. Looking for bulk projects direct from developers or lenders? Visit the Condo Vultures® Bulk Deals Database™. Our new books, the Official Condo Buyers Guide to Miami™Official Condo Buyers Guide To South Beach™Official Condo Buyers Guide to Sunny Isles Beach™Official Condo Buyers Guide to Downtown Fort Lauderdale and the Beach™Official Condo Buyers Guide to Hollywood / Hallandale Beach™Official Condo Buyers Guide to Downtown West Palm Beach™, and Official Condo Buyers Guide to Boca Raton / Deerfield Beach™, are now available. Want to see every foreclosure filed in South Florida since 2007? Check out our Foreclosure Database™.

© Copyright 2012. Condo Vultures® LLC. All Rights Reserved.  


print
CVR Realty - South Florida's Condo Experts
Condo Vultures® Realty - Distressed Property Experts
© Copyright 2014. Condo Vultures® LLC. All Rights Reserved.
Condo Vultures® LLC | 425 NE 22nd St. | Suite 409 | Miami | FL | 33137 | Phone: 800-750-0517 | Fax: 888-688-3415