Rob Arnold, metro Orlando full service, investor friendly & foreclosure Realtor

There have been several articles over the last year about the next big wave of foreclosures coming down the pipeline. 60 Minutes did a whole documentary on this last year.

Today USA Today published another article discussing the backlog of foreclosures on the horizon caused by failed short sales, failed modifications, government moratoriums, etc. Another 7 million homes in the USA are destined to go into foreclosure over the upcoming months.

This article makes an interesting read: Another Wave of Foreclosure Looms.

Central Florida / Orlando gets hundreds of new foreclosure case filings every single week. So anybody that is telling you that "the recession is over" is simply kidding themselves. I hate to say it, but it sure looks like a tidal wave is on its way to shore in the near future. If you are in the real estate business you need to continue to be focusing on foreclosures, REOs, and short sales. They are going to be around for many years yet to come.

The Orlando real estate statistics for October 2009 have been reported by the Orlando Regional Realtor Association. Here is a direct link to these stats. Below is a breakdown on the numbers. The stats are for Orange & Seminole County, Florida including Orlando, Apopka, Ocoee, Winter Garden, Winter Park, Altamonte Springs, Longwood, Casselberry, Lake Mary, Oviedo, and Sanford.

Inventory New Pendings Under Contract Expired Withdrawn Closed Days on Market

January 09 22,613 2282 3830 1377 1598 1050 103

Sept 2009 15,967 3858 8790 846 1014 2292 96

Oct 2009 15,743 3864 9050 924 646 2206 98

If you look at some of the graphs at the link above, you can really see how inventory has plummeted. It hovered around 26,000 properties during most of 2007 into early 2008. Then slowly started decreasing to where it is today. The inventory decrease does appear to have slowed. Most of this slowing has to do with a giant backlog of pending short sales which often take several months to actually close. From my own rough estimates, approximately 62% of the current pending contracts in metro Orlando are short sales.

The number of sold properties continues to be strong. Although sales were slightly less than in September, at a volume of 2206 they are still the highest they have been since August 2006. Actually in July 2009 we saw the first time in several years where the number of sold properties exceed the number of properties that didn't sell (expired + withdrawn).

Foreclosures still dominate the Orlando landscape. Roughly 20% of the sales in October were short sales while another 43% were bank owned REOs. Only 37% of the sales last month were not in foreclosure.

Prices are another story altogether the median price for October was $130,000 and the average price was $161,800. These are way down from just a year ago in October 2008 when they were at a median of $175,700 and $220,200. But talk to any good Realtor and they will tell you that just about any property priced under these median amounts will sell within a matter of days if not hours right now - unless the property is a piece of junk and is not desirable to most buyers.

The median price for bank owned REOs was $70,000, for short sales $125,000, and for non-foreclosure properties it was $185,000. This just goes to show the disparity between foreclosure prices versus non-foreclosure prices. Also many of the bank REOs are condominiums which are selling for unbelievably cheap prices right now.

I'm just glad to see all the activity. If you are interested in more detailed statistics for the Orlando real estate market or just wonder what your home is worth, feel free to contact me directly.

October was another strong month for home sales. Our office sold 32 properties last month and many more are pending for November. Banks love to dump their REO and short sale inventory during the 4th quarter so that it won't be on their books for the new year. Look at some of these great Central Florida home deals that closed in October 2009.

Fisher Drive Morning Glory Lane Pelican Lane

- Fisher Drive, Deltona, FL 32725. This 3 bed/2 bath/2-car garage home was a true investor special. Bank owned REO needing a bunch of work but what do you expect for this sort of price. It sold for the super cheap price of just $46,000 after just 5 days on the market.

- 1st Avenue, Altamonte Springs, FL 32714. 3 bed/1 bath/1-car garage block home. Located in the coveted Lake Brantley school district in Seminole County. House was a true handyman special, but the bank REO department wanted it sold. Seller let this one go for the low low price of just $27,500.

- Morningside Drive, Orlando, FL 32806. Big 4 bed/3.5 bath pool home. Just steps from Lake Lancaster near Delaney Park in downtown Orlando. Owner was motivated and this was priced to sell. After only 6 weeks on the market it sold for $270,000.

- Morning Glory Lane, Kissimmee, FL 34747. This was a fabulous short sale home in Celebration Florida. 4 bed/2.5 bath/2-car garage with spacious kitchen and modern features. At the top of the market this home sold for over $500K but we negotiated a short sale with the bank at just $340,000. We still have one more Celebration short sale home available. Call for details.

- Pelican Lane, Orlando, FL 32803. 3 bed/2 bath block home near downtown Orlando. Bank owned REO and a great wholesale deal. This Audubon Park home sold for just $105,000.

Our office has a constant stream of new bank owned REOs, foreclosures, short sales, and other investor specials. Make sure to sign up for our weekly hot property email list.

The City of Casselberry Florida has a new rental regulation and tax on their horizon. The City of Casselberry is planning on increasing revenue by a "very conservative ... $22,000" by tacking on yet another layer of fees and regulations onto the back of rental property owners most of whom are already strapped financially.

Proposed resolution 09-2088 would force owners of rental properties including single-family homes, condos, mobile homes, and apartment buildings to pay an additional tax each and every year for every unit they own in the city limits of Casselberry. Additionally the property owner would be required to provide their contact information to city hall so that code enforcement could more easily get a hold of them in case of a violation.

Now granted, the tax collector can easily get a hold of property owners each and every November when the property taxes come due. And the Seminole County Property Appraiser website already has maintained on a list of owners and addresses for every parcel within the county. But this isn't good enough. The solution is to tighten the noose around rental owners yet again and end up forcing more of them into foreclosure or bankruptcy in a tough economy.

The 1st hearing on this proposed rental regulation ordinance is this Monday, October 26, 2009, at 7:00 p.m. at the Casselberry city commission chambers.

You can read the entire proposed ordinance here.

An interesting debate is going on in Washington. The National Association of Realtors is doing everything it can to get the $8000 tax credit extended beyond the November 30, 2009 deadline.

However, the White House is still undecided. In a recent CNN article, Shaun Donavon, the Secretary of HUD says the statistics aren't in just yet to show whether this tax credit has spurred the economy.

Apparently the IRS is screaming all types of fraud saying that a significant portion of the tax payers filing for the tax credit may have done so fraudulently. Over 107,000 questionable files have been opened by the IRS according to Fox News. To me that's not surprising. Look at all the fraud and "bonuses" that have been paid out as a result of the TARP money in Fall 2008. Everytime the government creates some new handout or incentive there is always lots of fraud that happens.

Personally I still have mixed emotions on extending the deadline on the tax credit. So I haven't contacted my Congressman either way. Seems like nearly 40% of the buyers in my market are paying cash. So while the tax credit has had some impact, it probably hasn't been as much as they are hyping it up to be. However at the same time I know the tax credit has knocked some buyers off the fence which is a good thing.

It will be interesting to see what happens in December if they don't extend the deadline. If you are planning on taking advantage of this, you better get a contract signed quickly because the time is running out fast.

My bet is that like the Cash For Clunkers program, Washington will allow this program to end and not revive or extend it. But who knows for sure.