A quick scan of the MLS these days quickly confirm the fiercest competition for home sellers in SW Orlando are foreclosures. Quite a big percentage of homes on the market are preforeclosure and foreclosure properties. Many of them are in great condition which is not something that’s been associated with foreclosures. While the vast majority require renovations, there are some that require just minor flooring and paint improvements. Home sellers argue that foreclosures are not as nice or in as good a condition and that’s not always true anymore. What can be true is the fact that they are affecting prices and sales figures in our market.
Whenever anyone hears foreclosure associated with a home for sale, they automatically think it’s a better deal. The fact is foreclosures are not always a great deal especially after you factor in renovations, but buyers are attracted to the idea of buying a foreclosure. Appraisers often include them in valuations these days bringing values down for all the homes around them. Banks don’t pay any attention to homeowner’s associations, so foreclosures in a neighborhood often cause assessments and increases in dues. That’s because the homeowner’s associations can not collect delinquent fees and maintain lawns that are overgrown and shabby looking. Besides bring values down, foreclosures also affect our homeowner’s associations. It’s especially true for condo and townhouse developments.
A check on Realtytrac shows that the Metrowest zip code of 32835 consistently has had the most foreclosures in Orange County. It saw 249 foreclosures in September 2008 alone. My guess is that the majority of these foreclosures are the numerous condo conversions that investors purchased during the boom years. They were bought in buyer lotteries and you literally couldn’t buy one unless you were on the waiting list very early on. Now you can’t give these things away. To make matters worse, many of these associations are in sad shape because they can’t collect dues on many of the units. So the people who are responsible with paying their mortgage and their dues are punished. It’s a sad reminder that life isn’t always fair.
Some of the other areas in SW Orlando suffering from high foreclosure rates are Hunters Creek and Dr. Phillips. Hunters Creek saw 187 foreclosures in September 2008 which is the fifth worst and the two Dr. Phillips zip codes of 32819 and 32836 had 105 putting them in the middle of the pact. 22,645 foreclosures have sold this year as of July 2008 in Orlando.
Foreclosures not only punish those unable to pay their mortgages, they also affect everyone around them. They’re also a great buying opportunity and the cause of our nation’s financial crisis. Most of all, they’re affecting the responsible citizens who pay their mortgages.