Hialeah Foreclosures for Sale Driven by Negative Equity

by Peter Vernon on cities

Hialeah foreclosures for sale are still high in number because of the still large number of homeowners submerged by negative equity.

Based on a report from a real estate research firm, over 46 percent of all owners of single-family houses in South Florida or almost 388,000 homeowners have negative equity in the July-September quarter.

The percentage of underwater borrowers dropped from the 393,473 underwater mortgages in the April-June quarter or 47 percent of all mortgage loans, but the drop is only one percentage point and the percentage of 46 percent is still very high.

According to Bill Richardson of Keyes Boca Raton, home prices fell to their bottom levels in the April-June quarter and did not increase by substantial percentages in the following quarter.

Nationwide, according to the research firm, the percentage of underwater borrowers dropped in the July-September quarter to 21 percent from the previous percentage of 23 percent. Analysts said the decrease arose from the temporary stabilization of prices in many areas and the completion of foreclosures on underwater mortgages.

Hialeah foreclosures for sale have also been rising in the commercial sector. A recent commercial foreclosure was the four-acre Vivo Fonte industrial park project, which was partially developed by One Shot Development Corporation and its founder Hector Marrero. In 2008, Marrero borrowed $6.2 million from Metro Bank of Dade County to develop the site, but he was able to build only two buildings on the site and failed to pay his loan balance of $3.9 million.

The Vivo Fonte project was the second commercial project lost by Marrero in Hialeah. In February, Marrero and his other company Baron Enterprises also were hit with a foreclosure claim of $2.4 million over a certain commercial project in Hialeah.

While lack of tenants and business failures hit commercial projects, sharp drops in home values continued to batter the residential sector. In the Miami metro area, home values have fallen by more than 17 percent in the July-September quarter compared to the same period last year. The home price during the third quarter was $168,400, based on a home index that measures values for all types of homes sold.

According to the index, home values dropped the most in the county of Miami-Dade, falling by more than 24 percent to $172,600. Within Miami-Dade, home values dropped the most in the Hialeah Gardens neighborhood, falling by more than 32 percent.