Distressed sales still a big part of housing market

 MIAMI – Feb. 5, 2016 – Even with the real estate market recovering, more than a quarter of all South Florida home and condominium sales in 2015 involved a distressed property, a new report shows.

Short sales, bank-owned homes and properties in some stage of foreclosure accounted for about 27 percent of all sales last year in the tri-county region, according to RealtyTrac Inc., a foreclosure-listing firm.

Distressed sales represented 32 percent of the market in 2014 and 34 percent in 2013.
Although 27 percent is an eight-year low, "South Florida still has a ways to go before that segment of the market gets back to normal," Daren Blomquist, a vice president of RealtyTrac, said Wednesday.
The company considers a typical level of distress in the 5 percent to 10 percent range.
Bank-owned homes were the most commonly sold properties last year among the three categories of distress.
Fewer buyers are entering the foreclosure process, but Florida courts are still processing a backlog of cases that piled up during the housing collapse. That's leading to more repossessions, and lenders are turning around and reselling those homes to new buyers.
In 2009, near the peak of the housing collapse, just more than half of all home and condo sales involved a troubled property, RealtyTrac said. Banks frequently unloaded those homes for pennies on the dollar, so buyers lined up hoping for big bargains. But as the market improved and prices increased, the discounts disappeared.
Judy Trudel, a real estate agent in Palm Beach, Broward and Miami-Dade counties, said she's surprised that distressed sales remain such a big part of the housing market in South Florida.
"Nine times out of 10, you can't even find a foreclosure," Trudel said.
Short sales are particularly rare because higher home prices are restoring lost equity and leaving fewer owners owing more than their properties are worth.
Nationally, distressed homes and condos accounted for 17.3 percent of all sales in 2015, an eight-year low, RealtyTrac said. Florida (26.4 percent) had the nation's second-highest share of distressed sales after Illinois (28.1 percent).
Copyright © 2016 the Sun Sentinel (Fort Lauderdale, Fla.), Paul Owers. Distributed by Tribune Content Agency, LLC.