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Buying Foreclosures Investment Real Estate Selling

Miami Real Estate – Shadow Inventory

Shadow inventory is basically the number of properties that are projected to hit the market due to distressed owners, those who are behind 90 days or more on their mortgage,  or because they will be or already have been taken back by the bank.  There has been a lot of speculation lately about how this background inventory will affect the housing recovery, with many experts saying it will significantly delay it.

A CNNMoney.com article on Shadow Inventory states: “Of the 20 separate markets S&P analyzed, Miami was the only market of the 20 that S&P analyzed where shadow inventory did not did expand during the first three quarters of 2010.”

What does this mean for buyers?  Record high affordability and a wide selection of properties to choose from.

For sellers, it means a continued suppression of prices, with prices either dropping further or bouncing along the bottom for a while.  If you were thinking of selling your home within the next year or two, you may want to put it on the market now.  Or, if you have equity in your home and have entertained the idea of owning investment property, turn it into a rental and buy your move-up, downsizing, or retirement home at the lowest prices we have seen in a long time.

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Buying Foreclosures Selling

Miami Real Estate – Thinking of Selling, Now is the Time. Thinking of Buying? Now is the time.?!

How can it be both the right time to sell and the right time to buy?  Usually, if it is a seller’s market, prices are high and inventory is low.  If it is a buyer’s market, it is the other way around.  We currently have enough overall inventory of single family and condos in South Florida to make it a buyers market so, if you are a seller, you may think of holding off until the inventory decreases.  If you have the holding power, you are right.  If you need to sell, but were thinking of holding off for the Spring, read Steve Harney’s blog, Oswald Acted Alone and We Did Land on the Moon.

If you are a buyer and read the blog, you will be tempted to hold off, figuring prices will fall further and you could get a better deal.  The difference is that with a home buyer, unless you are purchasing with cash, the cost of the home is often more important than the price.  Another great Harney blog, 3 Questions You Must Answer Before Buying a Home, can help you determine if you would be better off waiting until the end of 2011 or purchasing now.

Remember, real estate is hyper-local and your specifications for a home or investment property, may be completely different from what is going on in a city, county, state or nationally.  Some areas experienced less price decreases, short sales, and foreclosures than others.

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Buying Foreclosures Market Summary

Miami Real Estate – Foreclosures and Shortsales

As of December 2010

REO Homes were 12% of Total Inventory and 41% of Total Sales

Single family home Short Sales were 32% of Total Inventory and 19% of Total Sales

REO Condos were 9% of Total Inventory and 46% of Total Sales
Condo Short Sales were 32% of Total Inventory 22% of Total Sales

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Buying Foreclosures

Miami Real Estate Foreclosures: They Are Still Coming On The Market

Even though several large banks froze their foreclosure process in September, there are still plenty of foreclosures coming on the market in Miami.

There are currently 827 single family homes that are listed as REO on the MLS.  423 of them were listed since October 1.

There are 1116 condos listed as REO.  640 of those have been added since  October 1.

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Buying Foreclosures

Miami Real Estate – Will the Miami Heat Lead to an Increase in Sales?

Okay, so the Miami Heat have won two in a row after their disappointing loss in Boston.  With so much fanfare around the  team, condos in the immediate area have decided to latch on to the Heat as a way to increase sales in buildings that are currently mostly occupied by renters.  Other than the Heat, these buildings have a lot to offer location wise.  Although there is still infrastructure in the immediate area missing (shopping and restaurants) outside of Bayside Marketplace, there is a lot the area has to offer.  It is a quick drive to South Beach, located across from the future Museum Park and a stroll under I-395 to the Arsht Center for Perfoming Arts.  So are you enough of a Heat fan to be compelled to buy in one of these new buildings?

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Buying Foreclosures Selling

Foreclosure Freeze Already Having an Effect on South Florida

The Miami Realtors Association is already seeing the effects of the current decision by several banks to put a moratorium on foreclosures.  In the past two weeks, 1,154 REOs have been cancelled, withdrawn, terminated or temporary taken off the market according to Southeast Florida Shared MLS Database.  In the two-week period immediately preceeding the announcement, only 225 were removed.
A nationwide foreclosure moratorium (possibly being considered by Congress) would devastate the recovery of the home market, which is vital to our economic recovery. Realtors believe that all homeowners should have due process and are proposing that banks do the following while REO’s are under review:

  • Allow pending foreclosures to be considered for expedited short sales.

  • Streamline the short sale process by pre-approving the seller in advance and determining a list price and minimum net proceeds amount before accepting any offers on the property.
  • Establishing a process to review all offers within a specified time period with heavy consideration given to the highest and best offer, no the current model of one offer at a time.
  • Ask homeowners to consider a deed-in-lieu of foreclosure and negotiate the deficiency amount.

What are your thoughts or suggestions?

Categories
Buying Foreclosures Investment Real Estate Selling

Foreclosure Freeze: Good For Distressed Owners, Bad for South Florida Real Estate Market

The recent decision by some banks to freeze their foreclosure process while they investigate their procedures for handling foreclosures has a mixed effect on South Florida’s real estate market.  While it may be a good thing for distressed owners who really want to keep their homes, it is probably not a great thing for current buyers and the overall real estate market.  The reality of too many homeowners who bought at the height of the market, owners who are currently underwater, unemployed, or simply bought way more house than they could afford when banks were in a lending frenzy, means the majority of homes in foreclosure now probably will still be there at the end of the investigation.  Yes, there are stories of homes foreclosed improperly, including that of an owner who had paid cash on the house, and many of the banks and their foreclosure attorneys have become mills that may have filed paperwork incorrectly or downright fraudulently (this is the fraud capital of the United States, unfortunately).   These procedures should be investigated, stopped and punished.  In the meantime, buyers who are currently under contract are in limbo and the real estate market, which has been slogging through high inventories, may slow since approximately 40% of the home sales in South Florida are made up of bank-owned properties.

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Buying Foreclosures Selling

Are Real Estate Sales Really Up in Miami?

If you read the papers, listens to the news, or talk to friends, neighbors and acquaintences about the real estate market, you could be very confused as to what is “real” about it.

  • Foreclosures and short sales are still high.
  • Unemployment is still high and actually rose more vs. high and dropping.
  • Inventory is still high.

Yet, week after week, our EWM office in Coral Gables is selling more than we are listing.  This week alone, we had over $28,000,000 (yes, that is million and it was closer to $29) in sales and leases, the majority in sales.  We had 29 sales vs 8 sale listings.   What is even more amazing about the sales in our office this week:

  • 11 of them (38%) were over $500,000 vs 9 that were under$300,000, which is where most of the market has been this year;
  • 7 of them were over $1,000,000 so the high end market is starting to move.

What is especially important in these numbers is that the higher end sales are not relying on the first time home buyers tax credit, since they don’t qualify, and they are buying anyway.  This leads me to believe that the real estate market is starting to stabilize, especially in certain areas.

Categories
Foreclosures

Bloomberg's Foreclosure Index Up 3.8% From One Year Ago

0218-foreclosures
Source: Bloomberg

Categories
Foreclosures

Bloomberg’s Foreclosure Index Up 3.8% From One Year Ago

0218-foreclosures
Source: Bloomberg