Fort Lauderdale Foreclosures for Sale Held Back Home Prices

by Simon Lindsay on cities

The still large number of Fort Lauderdale foreclosures for sale has been holding back home price increases in the Fort Lauderdale, Miami and Pompano Beach metro area, based on reports from Florida Realtors and real estate research companies.

In the July-September quarter, sales of previously-owned homes increased, but sales prices decreased because of the still high percentage of foreclosure properties sold.

Sales of pre-owned single-family homes rose by 40 percent to more than 2,500 units while the sales price median dropped from $277,900 to $212,900.

Sales of condo units soared to 2,671 units, an increase of 61 percent from sales in last year’s third quarter. The sales price median plunged from $134,000 to only $81,300.

Statewide, sales of pre-owned single-family homes climbed up by 33 percent to 44,345 units in the July-September quarter. But the median price dropped by 22 percent to $145,400.

Sales of existing condo units also soared, jumping by 56 percent to 14,797 units. But the median dropped from $160,100 to $106,100.

Although foreclosure filings decreased by more than 5 percent in the Fort Lauderdale area in the July-September quarter compared to the previous quarter, the level of filings is still high compared to other metro areas. In addition, the nearly 54,000 filings posted during the quarter were still above total filings in the July-September quarter last year by nearly 35 percent.

According to members of Florida Realtors, the discounted prices of Fort Lauderdale foreclosures for sale and other distressed homes continued to push down home prices in the July-September quarter despite the drop in foreclosure filings during the same quarter.

Homeowners in Fort Lauderdale and other areas of South Florida continued to suffer from negative equity, with nearly 390,000 of all owners of single-family houses in the area or over 46 percent of all households with mortgage loans underwater by the end of the July-September quarter.

Mortgage analysts, including Scott Coloney of the Foreclosure Response group in Fort Lauderdale, explained that foreclosure filings dropped slightly not because of improvements in the economy or in the employment rate, but because of the decision of lenders to regulate the number of foreclosure properties entering the housing market.

Coloney added that lenders have been stepping up their loan modification efforts because they want to control the fall of home prices and to avoid the costs of maintaining foreclosure houses.

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