Stuart Foreclosure Listings Continue Downward Momentum

06.29.15 by

Stuart Foreclosure Listings Continue Downward Momentum

 Bank owned

If you are one of those Stuart homeowners who has been gladdened to see property values continuing to rebound, you have also been pleased at the steady decline in the wave of foreclosures that were part of the global financial crisis. When the subprime mortgage crisis triggered widespread financial dislocation, many homeowners felt the repercussions. Every Stuart foreclosure that resulted weighed on neighborhood property values, which reflect the dollar amounts paid when nearby homes change hands.

Even most people whose livelihoods were unaffected—who kept their jobs or businesses and continued to make their mortgage payments without difficulty—could have suffered as a result. When the apparent equity of a home dwindled, so too was the amount lenders were willing to lend for refinancing. The comfort provided by fat home equity lines of credit (the HELOCs) suddenly melted when their maximums were cut, or even withdrawn altogether. HELOCs, after all, were a major component in the foreclosure phenomenon. The whole atmosphere caused confidence to be shaken.

But ‘buy low, sell high’ is a proven investment strategy—and ‘buying low’ is an opportunity that typically arises when fear is in the air. Many large institutional investment outfits looked at the situation and apparently asked themselves, what’s more “real” than real estate? They dived into the panic, buying up distressed residences in droves, paying rock-bottom foreclosure prices.

For many homeowners, though, the real effect was psychological. After all, when your major asset is your home, any Stuart foreclosure can be seen as having the effect of bringing your apparent net worth down.

RealtyTrac is the national scorekeeper for foreclosures and REOs (Real Estate Owned, or bank repossessions); and last month they continued to provide comforting news. Although there are ups and downs in the month-to-month stats, the overall trend continues to decline from the high in September 2013. In fact, there was a small uptick in REOs in April, which might seem like bad news; but REOs are actually completed foreclosures—at the same time, foreclosure starts continued their long slide downward.

Daren Blomquist of RealtyTrac was quoted with more good news, confirming that “the overall increase in foreclosure activity in April is a continuation of the clean-up phase” of the housing crisis. But even better was this: “Foreclosure starts nationwide are now running consistently below pre-crisis levels.”

It does seem as if this season is a choice time for sellers to enter the revived market. If you would like to explore the possibilities for your own property, or are ready to start the search for a Stuart home of your own, please do give me a call!

 Stuart Foreclosure Listings Continue Downward Momentum

 

Stuart FL Foreclosure Hunters Continue to Draw National Competitors

05.02.15 by

 Stuart FL Foreclosure Hunters Continue to Draw National Competitors

stuart fl foreclosures

You would think the outside competition for Stuart FL foreclosure bargains might have up and disappeared by now…but no! As The Wall Street Journal described it the other week, the shrinking number of foreclosure opportunities hasn’t driven Wall Street’s professional investors completely out of the market. But new techniques are altering their approach.

Local Stuart FL foreclosure investors have had to worry about a previous incursion by big national private equity investment firms. In the aftermath of the real estate bust, sales of distressed properties assumed an ever-larger proportion of real estate activity. National firms seized on the growing supply of cheap foreclosed homes as a ‘sure-thing’ trade for investment firms backed by money from private equity companies who wanted ‘in’ on real estate.

Wall Street knew full well that depressed real estate prices were a temporary phenomenon. They would swoop down, buy foreclosures en masse, rent them out, and wait for the bounce-back. Your Stuart FL foreclosure investors suddenly had to worry about bargain-hunting by the national firms, instead of just the usual local competitors. It took agility and cash to compete with some very deep pockets. Even where they weren’t active, their impact was felt.

But by last summer, the New York Times was headlining “Investors Who Bought Foreclosed Homes in Bulk Look to Sell.” Where, at the height of the foreclosure onslaught, a full 50% of home purchases was made up of foreclosures and short sales, by this February, the percentage had retreated to barely 11%. Companies like Waypoint Real Estate Group began quietly shopping for buyers as they took their profits and tiptoed away…

So could Stuart FL foreclosure investors breathe a sigh of relief, knowing the big boys had carted off their wheel barrows full of cash? You’d think so, but not so fast! The WSJ article describes a new phenomenon from outside. “Racing to Buy Homes Sight Unseen” was the headline. Enter the speed-based investors!

Just as trading firms had developed systems that made equity trading a competition between banks of computers trip-wired to trade at the speed of light, a milder phenomenon is emerging in foreclosure investing. According to the Journal, one example is the investment trust executive who no longer goes to public auctions to find buys. It described a recent morning in which it took him seven minutes to bid on a Georgia home “he had never seen.” He uses a quantitative data analysis program as a way to accelerate searches for the “dwindling supply of available homes that can be transformed into rental properties.” In other words, some of the big buyers are finding ways to stay in the market.

But Stuart FL foreclosure investors don’t really need to throw up their hands. Although the data analysis programs are getting better, local knowledge and on-site evaluations should continue to give sharp Stuart FL investors the kind of fine edge that national data maps and renovation cost generalizations can never quite match. It’s like the difference between a perfectly-engineered robotic customer service system…and a knowledgeable human: no contest.

Stuart FL foreclosures may be less omnipresent, but without question they continue to represent great investment potential—and not just for the national investment firms. If you’ve ever thought you would like to hear more about today’s opportunities, call me for an on-the-ground analysis!

FREE List of Foreclosed & Short Sale
Homes for Sale in Stuart: