Foreclosures in Florida fall sharply

By Michael Braga
Published: Thursday, December 11, 2008 at 1:00 a.m. - Bradenton Herald Tribune

The number of foreclosures filed in Southwest Florida and across the state fell dramatically in November and is expected to fall further in December because of moratoriums declared by the state's lenders at the urging of Gov. Charlie Crist.

Manatee County saw the biggest drop in the region, reporting 363 foreclosure filings, 59 percent fewer than in October and 24 percent less than in November 2007, according to statistics released Wednesday by RealtyTrac, an Irvine Calif.-based market research firm.

Charlotte County logged 472 filings, down 28 percent from October, while Sarasota recorded 1,111 filings, a 3 percent drop from a month earlier.

The dramatic declines had at least one Realtor who specializes in foreclosed properties declaring that the foreclosure crisis has peaked.

"We may have passed the top of the cycle," said Matt Augustyniak, broker and owner of Horizon Realty in Bradenton. "Three years ago takes us to the end of 2005 when sales dropped off. There were not as many mortgages in 2006."

Foreclosure filings dropped 9 percent to 49,190 in Florida during November when compared with the previous month, and by 7 percent to 259,085 in the United States as a whole.

"Foreclosure activity in November hit the lowest level we've seen since June thanks in part to recently enacted laws that have extended the foreclosure process in some states, along with more aggressive loan modification programs and self-imposed holiday foreclosure moratoriums introduced by some lenders," said James J. Saccacio, RealtyTrac's chief executive, in a statement.

"There are several indications, however, that this lower activity is simply a temporary lull before another foreclosure storm hits in the coming months.
Saccacio noted that the Mortgage Bankers Association reported that delinquencies on loans not yet in the foreclosure process jumped to nearly 7 percent in the third quarter, a record high.
He also noted that U.S. Office of Thrift Supervision reported that more than half of the homeowners who received loan modifications to reduce monthly mortgage payments in the first half of 2008 are already delinquent again.

"Many of these delinquencies could turn into foreclosures next year," Saccacio said.
Dennis Black, a Port Charlotte real estate consultant, also believes the November drop is a temporary blip. "Remember, November is a month with a holiday. People tend to work less," he said.

Black also believes that the only thing the current 45-day moratorium on foreclosures will do is create a landslide of filings on the 46th day. "It's not going to change the fact that people are in houses they can't afford," he said.

It also is not going to change the fact that some people are victims of the crisis and others have found ways to profit from it.

Augustyniak, for example, says his firm is selling 35 foreclosed properties each month and another 25 through short sales in which buyers are paying less for properties than what banks are owed by former owners.

"Investors are coming in hot and heavy," Augustyniak said. "To me this is better than 2004 and 2005."

Margaret Amador, an agent with Allison James Estates & Homes who specializes in short sales, sees other investors holding off because of the financial crisis.

"I have a little three-bedroom house I am trying to sell on North Lockwood Ridge Road and I had a cash buyer who was willing to pay $77,000," Amador said. "But when the crisis deepened, this buyer decided he wanted to hold on to his cash."

For Venice resident Steven Baker, the crisis has produced nothing but frustration. He is trying to work with a bank on a commercial property he and his wife bought in 2006.

"In November 2007, we came to the bank in good faith to advise them we needed some options regarding our loan as we had been unable to sell, rent, or use the property," Baker said in an e-mail to the Herald-Tribune. "They managed to drag the process on and on, not returning phone calls, e-mails, etc."

"I think it all comes down to the fact the financial institutions really don't know how to handle the current situation to protect themselves, so will do whatever they can do at the cost of the borrowers, no matter what that cost is," Baker said. "They are finding the government will continue to issue handouts to themselves, so why make an effort to help the borrowers? They will get their money no matter what. It's a combination of greed and stupidity."

During November, Florida had the second most foreclosures in the country, with one for every 173 households. Nevada came was first with one filing for every 76 houses.

California and Florida cities accounted for 9 of the top 10 metro foreclosure rates. Cape Coral-Fort Myers posted the highest foreclosure rate with one filing for every 59 houses. Two other Florida cities ranked among the top 10: Fort Lauderdale at No. 7, with one for every 117 housing units; and Port Lucie-Fort Pierce at No. 8, with one for every 118 housing units.

Sarasota County had one filing for every 195 houses; Charlotte one for every 203; while Manatee had one for every 458.