It took less than a week for interested buyers to home in on the two-story, five-bedroom foreclosure on Salt Water Creek Court west of Lantana.
Advertised as needing a little TLC - a pressure wash of the roof, fresh paint on the trim - the Savannah Estates home joins the ranks of Palm Beach County's sought-after bank-owned properties, sales of which made up 31 percent of the area's total purchases during the first part of this year.
With a list price of $316,000, a thick blanket of St. Augustine grass and a bathroom with a bidet, this home isn't the typical foreclosure, which buyers have picked up for an average price of just $130,393.
Still, with competition high for distressed sales, it's likely to sell fast.
"I've already had two people call me just from the signs in the window," said James Smith, who works for Home Run Real Estate in Lake Worth, which is listing the property for federal mortgage backer Freddie Mac.
According to RealtyTrac, a real estate analysis company based in Irvine, Calif., foreclosures accounted for 32 percent of all home sales in Florida during the first quarter of the year, selling for an average price of $97,450.
Nearly 28 percent of home sales nationally were of foreclosed properties during the same period.
While the volume of foreclosure sales dipped 32 percent in Florida in the first quarter compared with the same time last year, the 25,052 homes sold statewide still represents a super-elevated number of distressed sales compared with a normal market.
Typically, no more than 2 percent to 3 percent of home sales are of foreclosed properties. In 2005, foreclosures accounted for less than 1 percent of Florida's home sales.
"It's probably going to be at least 2014 or 2015 before we see anything close to that again," said Daren Blomquist, a spokesman for RealtyTrac. "Of course, that might be the more optimistic scenario. It could take longer."
RealtyTrac defines foreclosure sales as those of either homes that are bank-owned or where the owners have defaulted on the mortgage and received at least one foreclosure notice. Short sales could be included in the number if the home was in some stage of foreclosure.
Realtors who specialize in bank-owned homes say there has been an overall reduction in foreclosure inventory, partly attributable to the moratorium lenders put on foreclosures in the fall and a continued muddle in the courts.
Debbie Smith, broker/owner of Home Run Real Estate, which specializes in bank-owned homes, said banks are doing more short sales and loan modifications that may keep people out of foreclosure.
"A lot of banks are working with homeowners to keep them in their homes, and short sales are doing really well," she said. "It's just now that banks are starting to get a clue they can make more money that way."
Fewer foreclosures on the market means more competition among foreclosure-hungry buyers.
"Every property I sell has multiple offers on it," said Realtor Steven Paulsen, who specializes in foreclosure sales for SouthEast Florida REO in Pompano Beach. "The offers are either at or above list price."
Both Smith and Paulsen said Fannie Mae and Freddie Mac - government-sponsored entities - prefer selling to people who will live in the house, rather than investors who plan to rent.
On those properties, investors may have to wait as long as 15 days to make a bid, giving owner-occupants a chance to buy. Investors with cash, however, still may have the upper hand.
"A bank will take a discount for a sure-thing sale," Paulsen said.
RealtyTrac CEO James Saccacio said there won't be a real estate recovery until more foreclosures are bought up. With Florida's current inventory, that would take 30 months, the company estimates.
"There's no silver bullet, but once that stuff goes away, the market comes back," Paulsen agreed. "The reality is, you just have to get through it."
Source http://www.palmbeachpost.com/
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