Florida Second For Foreclosures – What Does This Mean For Property Investors?

Florida Tenanted PropertyForeclosures. They’re something I haven’t heard much about since Florida’s housing slump.

Now they are back in the news with the release of figures showing that Florida ranks second in the USA for them.

This was according to a report released by foreclosure monitors, RealtyTrac Inc, this month.

To clear up any confusion to those who may not understand what foreclosure is, it is the stage where the bank calls in the mortgage loan – not the act of repossessing the home which often comes later on.

One of the current foreclosure hotspots in the United States might be a familiar name to you.

It’s Orlando. The metro area of the city also ranks second in the country for foreclosures.

Putting it into numbers that’s 18,080 filings. We can break this down even more.

One in every 54 households in Orlando were foreclosed between January and June this year. So what’s going on? Or more importantly, how can Orlando or anywhere else in Florida be seen as somewhere safe to invest in property?

It might sound crazy. It might go against all the accepted wisdom in property investment but I can tell you it is easy for me to continue believing in Florida as an investment destination.

Not because I don’t care about these foreclosure rates.

Not because I want to just sweep them under the carpet. No, the news about Florida ranking second for foreclosures will not have any affect on my opinion. Let me explain.

I can even go as far as saying (with confidence) that Florida is the best place to invest in USA property. I can draw this conclusion because it is precisely down to this sudden reappearance of foreclosures.

Let us not forget that a considerable amount of home owners in the US defaulted on their mortgages during the slump. These will have taken time to reach the foreclosure stage.

According to one recent study, it takes an average 1,027 days or nearly 3 years for homeowners to get to the foreclosure stage in Florida which was nearly double the national average of 674 days.

This could be down to the way the banks are processing all the paperwork and the relatively higher number of foreclosures in Florida than anywhere else. Things however are now beginning to speed up.

A law was passed this year to help do just that in Florida.

It has come at a very convenient time for the banks. They can now speed up the process and get more for properties than they would have done during the slump.

Why would the banks sell property at a big loss? Better to wait for the recovery which has now arrived due to pressure on housing stock levels.

In essence the banks are now cashing in on this new boom, just like the rest of us should be. What are your thoughts? I would love to hear them.

 

Kind regards

Loxley McKenzie
Managing Director

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Categories: America Property Investment / Property Invest

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