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Ft Lauderdale Market Conditions- February 2010

By
Real Estate Agent with EWM Real Estate

It is very clear and apparent, the Ft. Lauderdale real estate market is stable and is about to make a turn for higher prices.

According to Trendsgraphix,  inventory levels in both single-family products and multi-family products dipped after making a small spike in January. The inventory level of single-family homes within the greater Ft Lauderdale market dipped to 9.9 months, down from 10.1 months in January.

The actual number of single-family homes currently on the MLS stands at 8,100. Of the current single-family inventory, only 6.1% was from foreclosures while a whopping 59.5% were from traditional sellers that still had positive equity within their homes. Inventory levels dropped from 11 months to 10.9 months according to the chart below.

The actual number of multi-family homes currently on the MLS stands at 12,917. From this raw number, 6.2% of the total represents foreclosures while 61.1% are listed as traditional transactions whose owners are in a positive equity territory.

Short sales, like the other transactions above are closely mirrored between the single-family and multi-family markets. On average the short sale today represents nearly 1/3 of the properties currently offered in the Ft Lauderdale real estate market. Short Sales, according to the Florida Association of Realtors are about to get a procedural make over. Since the Federal government's loan modification process turned out to be a huge joke, they have turned their attention to making the short sale process more successful. The changes being made have people on both sides of the aisle once again [so what's new with that concept, right?]  Here is a short list of changes being made effective as of April 5, 2010:

The new Home Affordable Foreclosure Alternative program will run until Dec. 31, 2012. Among its provisions:

    The lender must offer a short sale in writing to the borrower within 30 days after the borrower either is ruled ineligible for mortgage modification under the HAMP program or has been ruled unable to sustain payments under a trial plan.

    A borrower may receive up to $1,500 to assist with relocation expenses.

    Incentives of $1,000 will be offered to lenders for each completed short sale. For each deed in lieu of foreclosure, in which the borrower voluntarily transfers the property to the lender, $1,000 will be paid to the lender.

    A lender with a second lien on the property will get up to $3,000 of the short-sale proceeds, or can pursue a short sale outside the program if it doesn't agree to share.

    The lender will not be permitted to reduce the real estate agent's commission after an offer on a property has been received.

The final piece of good news is that interest rates continue to be stable at just under 5% according to the Florida Association of Realtors. As of March 12, 2010, the rate for a 30-year fixed loan was 4.95%.

With all of the good that is finally being said about real estate, there is one scenario that I've noticed and makes me take cause with our profession. Within the price point from 100k-200k,  agents within the greater Ft Lauderdale area are allowing a vast number of multiple offers to be taken on their listings. In some cases, I've personally witnessed over 20 offers on a single property! Additionally, the agents will then submit every offer to the bank without looking at the strength or integrity of the deal. Many offers now submitted do not have actual cash tendered to the deal until the bank approves the transaction. This not only dilutes the importance and meaning of a contract, it reduces it to no better than making an airline reservation, only in this case, people's lives are being messed with.  

Someone or some organization needs to put a halt to this practice. I've personally seen many times over in the past months, "approved" short sale. This is now become a joke. By the time the lender makes their judgment as to the best offer, the person who's made the offer is long gone and probably living in their next new home. Meanwhile, there are throngs of hard working people who seem to be getting locked out of the ability to purchase a home.

With the deadline of the tax credit looming in the near future, I am hoping that our profession will rise to the occasion, consider the best offer for their seller and submit one offer to the lender. If all the agent is going to do is be a paper pusher rather than the expert, then why are they present? Let's stop this abuse. Let's eliminate the foolishness and let's help the people.

If you'd like to comment on this article, feel free to contact me by using this link.

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Bill Gillhespy
16 Sunview Blvd - Fort Myers Beach, FL
Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos

Morning David,  Your area seems very much in line with our market.  Certainly glad to see some positive indicators showing market support.

Mar 13, 2010 12:39 AM
Kathy Toth
Ann Arbor Market Center Keller Williams - Ann Arbor, MI
Ann Arbor Real Estate Experts - Kathy Toth Team

I am a picture person and love the graphs.  You might say I am a market report voyer.  I am curious about all areas of the country, especially mu sister state - FL in the foreclosure tsunami.  Best of luck to you David, Kathy O'Connor Toth in Ann Arbor, MI.

Mar 13, 2010 12:39 AM