Florida's housing crisis still isn't over
The state now holds a third of the nation's abandoned homes despite rising prices and improving sales.
With foreclosure rates down 23% from a year ago and the supply of new and existing homes at a 20-year low, that means the housing crisis is over, right?
Only if your neighborhood isn't still dotted with abandoned homes. Online real estate company RealtyTrac says Florida is littered with such neighborhoods, as the state is now burdened with 55,500 abandoned homes. That's a third of all abandoned homes in the U.S.
Florida became the face of the housing crisis and the ensuing recession as its unsold properties sat fallow and residents soon found themselves with mortgages valued at more than their homes could fetch on the market.
The Huffington Post shares stories of residents in Tampa battling overgrown bamboo and mowing lawns on properties long abandoned but not yet foreclosed upon. The banks that signed off on the mortgages for those abandoned homes are technically responsible for their upkeep, but maintenance is often minimal and corners are cut whenever possible.
Foreclosures still account for 27% of all sales in Tampa and 28% of all homes sold in Miami, according to RealtyTrac. Even though Florida has been luring more buyers to homes that haven't been foreclosed upon through short sales -- which sell homes for less than the mortgages owed and account for 26% of all sales in Florida -- that option is quickly disappearing.
Nationally, short sales fell by 35% in the first quarter from the same period a year ago. Rising home prices are coaxing more owners to hold on to their properties in the hope that they'll get the price they originally paid. Combined with average foreclosure prices rising by 28% during the first three months of 2013, that has made lenders less inclined to enter short sales.
While abandoned homes aren't just Florida's problem -- they represent 20% of all foreclosures in the U.S. -- nine of the 20 metropolitan areas with the most vacant homes in the country are in that state. Even as bank repossessions rose by 11% last month with lenders sprinting to take advantage of rising home prices, it's still tough to argue that the housing crisis has ended for the Sunshine State.
I sell Real Estate for a living and I am concerned with the "shadow inventory" in my area. Not what it used to be, but a lot of abandoned homes dotting the landscape. What also concerns me is the housing "recovery" has been driven by cheap money. My area jumped 22% in value 1st qtr 2013 over 1st qtr 2102. That big jump concerns me as well as it was largely driven by investors and or speculators.
We are getting close to negative cash flows in rentals at current selling prices as well. At the same time, rental rates are much higher than most home financing but that gap is closing as well. The local employee is most likely working retail or tourism as not much industry is left in these parts.
All looks hunk dory from the surface but I do believe trouble is brewing and we should all proceed with caution...
Boo Hoo. You took on a mortgage you knew you could not pay for and now you're doing a short sale, which means my taxes get to pick up the slack.
Tear the house down and turn it back into farm land as it has went up 40-50% in the last 3yrs.
WHAT?! But our govt told us everything would be ok! Things were back to normal! Are you telling me we have been duped?!
Isn't it interesting how things aren't as pretty when we meddle in things instead of letting them take a natural course.
The FEDs could of given a stimulus to it's tax payers, and off set the cost to do so with higher taxes over the course of years so that money would go back into the system. Or, just give everyone across the board a loan modification in order lower the interest rates and or value of the homes. The people did not create the housing bubble, we were victims of it.
"What........... I thought everything was hunky dory."
What rock do YOU live under? Like clockwork... Florida real estate tanks. It's a God-forsaken place without water, kid. $250,000 condo-tel units can lose 90% of value just like that. The whole center of Florida has no water. You should consider giving up your day-job of being completely useless and a pariah, and take on one of those below Minimum Wage pay positions in elder-care. By the way... it's hurricane season... that's always a big draw for tourism.
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