Skip to main content

Over the last several years, I’ve been listening to policy makers describe Florida’s economy as a three legged stool…

Tourism, Real Estate and Agriculture

The policies driving Florida’s Foreclosure Purge reflect a desire to support real estate in Florida…and those policies are what are driving the 2014 Foreclosure Purge. The Purge is the effort from Florida’s courts to CLEAR THE FORECLOSURE BACKLOG….regardless of the real consequences.

I remember being in Tallahassee especially over the last couple years and having to respond to the attacks from legislators and the hired guns of different industries that blamed the courts for the backlog of foreclosure cases…..these voices tend to entirely ignore the FACT….that most of the delays are caused (and continue to be caused) by bank misconduct.  There is a very simplistic and frankly unsophisticated analysis of the issues surrounding foreclosure and reflects a desire to ignore a problem away rather than focusing on solving the very real and systemic issues that confront our state.

The focus on…CLEAR THOSE CASES…Rather than considering what will be the end product of a foreclosure case is reaching a critical mass point in the next year.  You see, while courts are busy throwing people out into the street (and increasingly even when The Banks don’t even want this to happen), it turns out there are precious few Real Buyers waiting to buy those now vacant homes.

New mortgage applications are at historically low levels and the only real robust purchasing segment had been all cash investors….emphasis, “had been all cash investors”….the Blackstones and Goldmans of the world are all coming to grips with the very real reality that purchasing single family homes to rent out is not a profitable venture.  So what you’re going to see…in the second half of 2014 in particular is a crash in real estate prices across Florida……Right at the time the real impact of Florida’s Foreclosure Purge is felt…but one parting thought….where exactly are all these foreclosure auctions?

The State of Florida is spending untold millions of dollars to fund Florida’s foreclosure courts, but I don’t see any mass of new foreclosure auctions hitting the public auction sites.  So what really is the practical impact of spending these millions? We’ve had ghost inventory and shadow inventory….is there a new inventory….Zombie Inventory?

Leave a Reply