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Foreclosure Filings Spike 36% In South Florida Region In Q3 2012
Foreclosure Filings Spike 36% In South Florida Region In Q3 2012
Published on 10/2/2012 4:08:00 AM

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Lenders initiated more than 13,200 foreclosure actions in the tricounty South Florida region in the third quarter of 2012, representing a 36 percent surge in filings on a year-over-year basis compared to the same July through September period in 2011, according to a new report from CondoVultures.com

For the year, lenders have filed nearly 35,700 notices of default - the first step in the repossession process - in the first nine months of 2012 in Miami-Dade, Broward, and Palm Beach counties after filing less than 24,000 actions during he same January through September period in 2011, according to the report based on the Condo Vultures® Foreclosure Database™.

Despite the spike in South Florida foreclosure actions in the first nine months of this year, the 2012 total number of filings initiated in the region is down compared to the same nine-month period in previous years when nearly 49,000 actions were filed in 2010 and nearly 75,500 actions were filed in 2009, according to the report based on filings with the Clerks of the Court for each respective county.  

"Lenders are stepping up their foreclosure efforts South Florida some two years after the 'robo-signer' controversy first surfaced late in the third quarter of 2010," said Peter Zalewski, a principal with the Greater Downtown Miami-based real estate consultancy Condo Vultures® LLC. "As the South Florida real estate market increasingly shows signs of improving, lenders appear to be intensifying their efforts to work through the region's foreclosure mess. The unknown is whether lenders are filing foreclosure actions with the hopes of actually repossessing properties from borrowers in default or simply prompting action after years of inactivity due to a number of factors."

Administrative irregularities - dubbed 'robo-signers'  - in the repossession process first surfaced two years ago 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 reached the National Mortgage Settlement Agreement with the federal government and the attorneys general from 49 states to provide at least $25 billion in relief to borrowers.

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.

Buyers purchased 24 percent fewer condos and townhouses as shortsales in Miami-DadeBroward, and Palm Beach counties in the third quarter of 2012 on a year-over-year basis compared to the same July through September period in 2011, according to an analysis by the licensed Florida brokerage CVR Realty™

As of Oct. 1, 2012, less than 2,000 condos and townhouses are on the resale market as shortsales in South Florida while an additional 7,300 shortsale units are under contract waiting to transact, according to the report based on Florida Realtors association data. 

Shortsale units currently represent about 11 percent of the total condo and townhouse inventory available for resale in South Florida, according to the data. 

On the foreclosure front, nearly 334,500 filings have been initiated in South Florida since the real estate crash began in 2007. 

Barring some dramatic change, the peak of the foreclosure filing activity in South Florida appears to have occurred in 2009 when nearly 100,000 actions were initiated in Miami-Dade, Broward, and Palm Beach counties.  

Compare this to 2012 where the South Florida region is on pace to experience more than 47,500 actions based on the filing activity in the first nine months of the year. 

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.  

The CondoVultures.com new condo sales report is based on completed transactions where a deed is recorded and taxes paid as a result of the sale.  

Condo Vultures® LLC is a real estate consultancy and marketing company based in the 225 Midtown Building at 225 NE 34th St., Suite 209B, Downtown Miami, Florida, 33137. Condo Vultures® LLC can be reached 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.   


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