Foreclosure "Tsunami" Means The Florida Market Won't Bottom Until 2011

florida condos

Though sales of existing homes are ticking up in Florida, the state remains home to counties with some of the highest foreclosure rates in the nation.

Even worse, analysts predict that more are on the way and that the foreclosure problem won’t peter out until 2011:

Sun Sentinel: Although the percentage price declines narrowed in each county, foreclosures loom large in the months ahead, some housing analysts say. Broward is second in the nation with 10.2 per cent of first mortgages in default, according to Moody’s Economy.com. These are delinquent loans on which lenders have yet to start foreclosure proceedings.

“There are still a lot of foreclosures that are going to happen, and when they do, it’s going to knock down home prices,” said Chris Lafakis, an economist for Economy.com. “The number one driver of home prices nationally has been foreclosures.”

The West Chester, Pa., research firm expects South Florida home prices to keep declining through 2010 before hitting bottom in early 2011.

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