Florida Foreclosure Crisis Continues to Harass the State

Posted on November 3, 2009
Filed Under Repo Homes | 2 Comments

With a foreclosure rate of 1:4 in Florida the crisis continues to harass the state. The rate is the highest in the nation. With the lingering recession another wave is poised to break. In fact it has already started to appear in courts. These are not sub-prime mortgages and other exotic loans but the cause is grave unemployment, plummeting of real estate market and continuing recession.

John Tur based in Miami instructs people about real estate investment. He warned, “The second tsunami of foreclosures is coming.” The numbers are already gripping. This will cause recovery in Florida to be delayed – it being the worst foreclosure affected state in the country, according to Mortgage Bankers Association.

As per the findings of First American CoreLogic the second highest foreclosure rate was reported from Miami-Dade County – it ranking after Osceola County of California. Broward County ranked 6th. Homestead that was the ground zero of the housing boom only two years previously ranks first in new foreclosure filings. The fear is that the situation is worsening.

In the gated community in Homestead, property that had once been sold for $242,000 is now begging to be sold for $70,000 reported Karen Klores of The Keyes Company. Sometimes to the cursory eye a neighbourhood seems normal without foreclosures as the condo associations keep the garden trimmed. But many of the units are shuttered.

Leselee Ramos had bought her three roomed town house in Malibu Bay for $255,490 in October 2006 but today its value has dropped to $121,800. While Ramos had a job she remained current on the mortgage payments but now that she has become unemployed things have come to a head. The house has been foreclosed upon. It is a tearing experience as she will find it difficult to start life anew with the black mark of foreclosure on her credit scores.

The condos as well as the suburban sub-divisions are facing the full brunt of the foreclosure crisis. In 2008 foreclosure of single family units were higher than that of condos by three to one. But now condos comprise 41% of the foreclosures in Miami-Dade and 67% in Broward County. It is a staggering 83% in Florida Keys as per the findings of RealtyTrac.

Guy Cecala publishes Inside Mortgage Finance. He commented, “I don’t think there’s any question the first wave of foreclosures we saw up until this year was driven by bad loans — the sub-prime loans with squirrelly features of big jumps in rates or payments. This year, we’re feeling the full brunt of the deep recession in the country. It’s economic-driven.”

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