Article Courtesy of The Orlando
By Mary Shanklin
Published December 16, 2013
Orlando had the sixth highest foreclosure rate in the nation during November – edging up from seventh place the month before, a report released Thursday shows.
Florida led the nation in foreclosures during the month, followed by Delaware, Maryland, South Carolina, and Illinois, according to the report by real estate research firm RealtyTrac.
In the four-county Orlando area, foreclosures are dropping but not as fast as they are nationally. Metropolitan Orlando had one foreclosure filing for every 384 houses last month – three times higher than the national rate.
Orlando-area foreclosure filings dropped 11 percent from a month earlier and 7 percent from a year earlier. But the region's recovery is much more gradual than the nation as a whole, which experienced a 15 percent drop in foreclosure actions for the month and a 37 percent decline for the year.
"While foreclosures will likely continue to stage a weak rally in certain markets next year as the last of the distress left over from the Great Recession is dealt with, it is highly unlikely that there will be a foreclosure comeback that poses any major threat to the solid housing recovery that has now taken hold," said Daren Blomquist, vice president of RealtyTrac.
Of the three stages of foreclosure tracked by RealtyTrac, new cases and sales were down for the Orlando area but auction notices increased to 1,135 from 884 in October and 402 in November. So far this year, more than 11,000 foreclosure properties in the Orlando market have been scheduled to be sold at public auction – up from about 8,000 for the same period last year.
Statewide, Florida has had 11 consecutive months of increased foreclosure auction notices from a year earlier.
As the pool of auction properties has increased, the type of buyer purchasing them has also begun to shift, said Daren Blomquist, vice president of RealtyTrac.
"It's pretty interesting when you talk to the local guys who have been at this a while," Blomquist said. "They are backing away from the auctions because prices are getting too high."
The large investment groups feel they're doing their homework before they purchase properties but they are more interested in meeting a quota than in ensuring that each house they purchase is of high quality. At the end of the day, he added, they can take a few bad ones here and there.
But the fact that longtime local investors are backing away from auctions should be a red flag to the equity firms and institutional buyers that they may be purchasing foreclosed properties at too high of a price, Blomquist said.