The latest numbers out of foreclosure ground zero — South Florida — are pretty ugly, though if you squint, there’s some good positives signs in there.
Lenders filed more than 7,000 foreclosure actions in November against properties in the tricounty South Florida region, representing an average of 233 filings per day in Miami-Dade, Broward, and Palm Beach counties, according to a new report from the Condo Vultures® Foreclosure Database™.
The November 2009 foreclosure actions represent a 15 per cent increase over the 6,085 filings in November 2008 and a 76 per cent increase over the 3,986 actions submitted in November 2007, according to the report produced using government records.
The November actions put the South Florida region on pace for nearly 97,000 foreclosure filings in 2009, down from a pace of more than 100,000 actions at the end of the second quarter on June 30. By comparison, lenders filed 75,000 foreclosure actions for the year of 2008 and 33,000 for the year of 2007, according to the report produced using government records.
“South Florida foreclosures continue to increase on a daily basis but just at slower pace than was being realised in the first half of 2009,” said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures® LLC. “A key reason for the slowdown in filings may be the sudden willingness of lenders to permit short sales by owners who owe more than their properties are worth. This philosophical adjustment by lenders is effecting the number of properties that are ultimately going into foreclosure and being repossessed by lenders.”
To repossess a South Florida residence, a lender must undertake a lengthy and costly legal process that can take up to a year.
Lenders normally plan for a six month to nine month process that will cost between $40,000 and $80,000 per property. In addition to that, many lenders do not even file the initial foreclosure paperwork – known as a Lis Pendens or a Notice of Default – until a borrower is at least 90 days late on regularly scheduled mortgage payments.
Once a lender finally does repossess a property, the bank inherits the responsibility of settling up outstanding liens on the property that live on after the foreclosure, such as property taxes, past-due condo association maintenance fees, and open permits.
On a county-by-county basis overall, Broward County, where Fort Lauderdale, Hollywood Beach, and Pompano Beach are located, had the highest number of foreclosure filings in November with 3,305, up nine per cent from 3,031 filings during the same period in 2008, according to CondoVultures.com.
Palm Beach County, where Boca Raton, Delray Beach, and West Palm Beach are located, had the second highest number of foreclosure filings with 1,890 in November, up 24 per cent from 1,526 filings in the same month in 2008.
Miami-Dade County, where Miami Beach, Key Biscayne, and Aventura are located, was third with 1,808 foreclosure filings in November, up 18 per cent from 1,528 filings in November 2008, according to the Condo Vultures® Foreclosure Database™.