The current foreclosure inventory is calling the shots in this market; there’s pretty much no other way to look at it. As gloomy as that sounds, homes for sale in Tampa Bay are finding new owners. It’s just that “foreclosure” is the primary rate of exchange in this market.
According to the Mortgage Bankers Association’s recent delinquency report for the country, approximately 9.5% of mortgage loans were either around 90 days behind or were already claimed by the foreclosure machine by end of March 2010. The result being that the foreclosure supply has far exceeded the demand for homes.
The United States alone has a two year inventory of foreclosed homes. Like condos or single family homes, foreclosures have become a legitimate subset of the real estate market. But their distinguishing characteristic of course is that they pose a threat to real estate values across the board.
While the recent S&P/Case-Shiller report cited that the property values of 20 U.S. cities have realized a 4% increase from one year ago; it is still not an exaggeration to state that foreclosed homes have made their splash and have caused some dramatic ripples in the market.
And again…just as huge opportunities produce big responsibilities, so it goes with buying a foreclosure; you’ll save on one end, but you’re likely to pay somewhere else: roof, major plumbing repairs, and your basic big ticket items.
You never really get something for nothing; the condition of the foreclosed property is often commensurate with the price tag.
Bottom line, there are plenty of properties from which to choose whether they are foreclosed, short sales, real estate owned (REO), or a traditional sale. Just take nothing for granted and buy nothing without an in-depth investigation.
Emotion is a key part in the home buying process, but if you approach (the foreclosure market especially) with the heart of a business person, you’ll sleep much better in that new home.