The World Is Changing Pretty Rapidly
The Star Tribune reports on Florida. “Fort Myers is the spring home of the Minnesota Twins, and so many Minnesotans visit or live here for at least part of the year that some have called it ‘Edina by the sea.’ It may still feel like paradise…but a short drive or a foreclosure bus tour reveals what was left behind when the housing bubble burst. Just east of Fort Myers, the weekend tours wind through Lehigh Acres, a once-fast-growing city of about 70,000 that’s been hard hit by the housing meltdown. It’s easy to reserve a tee time at the local Copperhead Golf Club, where fairways are lined with vacant houses and undeveloped lots.”
“‘You can get a house that sold for $700,000 three years ago in the $200,000s today,’ the starter told a group of hackers from the Midwest last week.”
“There were a staggering 22,000 foreclosure filings in Lee County, where Fort Myers is located, in 2007-08, compared with 1,600 in 2005-06.”
“In south Florida today, even the most informal conversations quickly turn to the economy and the housing free fall. There were few signs of a rebound at Copperhead Golf Course last week. ‘Come back Sunday,’ an employee said as he helped the Midwesterners pack up their clubs. ‘We’re really hurting on Sunday.’”
The Naples News. “September’s snapshot of home sales in the Fort Myers area is a picture of climbing sales yet growing inventory. September’s median sales price slipped another 6 percent from August to $126,250. That’s 42 percent lower than a year ago at $218,000.”
“The ratio of homes sold compared with new homes listed, which indicates to Realtors if the market is reaching a balance, fell to 33 percent compared with 39 percent in August. The drop came as the number of newly listed homes spiked 27 percent to 2,277 in September from 1,850 the month before. Realtors were encouraged by a 25 percent jump in pending sales as more than 1,400 contracts were signed in September. But as borrowers have struggled to receive loans, those pending sales may not translate to sealed deals.”
“The total number of homes on the market, 12,614, was the highest it’s been since November when there were more than 13,400 listed.”
“A leading economist said Southwest Florida’s housing market continues to sit on the bottom. Hank Fishkind was the keynote speaker at the conference, hosted by the Chamber of Southwest Florida. At last year’s event, Fishkind said the Southwest Florida housing market had bottomed out.”
“‘It just keeps banging along the bottom,’ he said. ‘Certainly, I couldn’t anticipate the financial panic.’”
“Fishkind said foreclosures in Lee County seem to have peaked, with year-to-date numbers down, but foreclosures in Collier County doubled in the same period. ‘It looks to me like we’ve seen the worst. Collier County’s going to have some problems going forward though,’ he said. ‘I didn’t think we’d see the surge in foreclosures in Collier County. I think it’s the last of the speculators throwing in the towel — or being forced to.’”
The News Press. “‘When we see a recession due to housing and credit issues, as we are seeing now, Florida suffers more than the rest of the U.S. and Southwest Florida suffers more than the rest of the state,’ Fishkind said. ‘Florida, in general, and Southwest Florida, in particular, depends on the ability of people in Northern states to move here. If they can’t sell their house in Boston … they can’t move here.’”
“At last year’s conference, Fishkind also predicted a two-year recovery period. ‘It’s never an easy task to pick the top and the bottom of a market,’ he said. ‘I’ve been at this 30 years and I’ve made my share of mistakes.’”
The Miami Herald. “Just how busy is Miami bankruptcy lawyer Michael Brooks these days? ‘If I wanted to schedule appointments Monday through Sunday, 9 to 6, I could do it,’ Brooks said. ‘It’s getting to the point where we’re turning away business.’”
“Nearly 13,500 personal bankruptcy filings were recorded in the first nine months of this year in the U.S. Bankruptcy Court for the Southern District of Florida, an increase of 75 percent from the almost 7,700 filed during the same period in 2007.”
“Bankruptcy trustees and lawyers attribute the surge in filings in South Florida to the area’s rising tide of foreclosures, brought on by falling property values and costly mortgage loans. ‘In the old days, people were saving their home from foreclosure [by filing for bankruptcy],’ said Jeffrey Tromberg, a lawyer for the Florida Debt Relief Center in Fort Lauderdale. ‘Now, more often than not, they are walking away from their home. They are no longer even attempting to save their home in bankruptcy.’”
“Most of what Brooks sees are people who bought multiple investment properties on the west coast of the state or north of Palm Beach County and who can no longer keep up with what they owe. ‘People are surrendering these properties left and right,’ Brooks said.”
“For months, South Florida business leaders have been thanking their lucky stars for Europe. A Miami vacation, a Fort Lauderdale Beach condominium, a boat made in West Palm Beach — all seemed cheap when you were paying in euros. Now, it seems, it may be time to pay the piper.”
“Marine-industry consultant Jim Bronstien heard an interesting story. ‘There were a number of offers for very large yachts, and the offers were rescinded after the market fell 700 points,’ said Bronstien, of Marine Business Advisors in Palm Beach County.”
“He said the industry has a lot tied to Europe’s fortunes. ‘I think anybody who isn’t a little bit concerned would be ill-advised,’ Bronstien said. ‘The world is changing pretty rapidly.’”
“A Coral Gables lawyer has been charged with helping to broker a crooked mortgage deal that used identity theft to buy a Coconut Grove house for more than three times what it was worth. Delaila Estefano and two men were charged last week with first-degree grand theft, organized fraud and using a fake ID.”
“According to an arrest warrant released Monday, someone in February used the identity of Bernardo Humbero Barreira to obtain a $484,286.06 mortgage from lender Citi Mortgage for a house owned by Romney. The price tag: $600,000. But co-defendant John Romney had paid just $185,000 for the two-bedroom, one-bathroom house just six days earlier. No payments have been made on the loan, police said.”
From Miami Today. “As foreclosures have spiked and loans become more difficult to come by, divorce proceedings have been prolonged, and in some cases, couples have put off a pending split. And in the case of death, homes have become controversial as parts of wills.”
“In cases of death, especially if it is the last living parent, a house left to split between children can be a messy matter, said Circuit Court Judge Celeste H. Muir, probate division. This is usually because most of the parents’ wealth is tied up into their home, Judge Muir said. ‘When somebody dies, if their will says they sell the house, it becomes a problem,’ she said. ‘The usual scenario is the children are expecting the proceeds to be 2006 prices and not 2008.’”
The Tampa Tribune. “The developer of Element, a 395-unit building under construction, has decided to turn the whole building into a luxury apartment complex, said John Akin, senior VP for development of Atlanta-based Novare Group. Akin would not say how many condo units have sold but said there were not enough contracts to finish the building as a condominium.”
“‘It will be a condo-quality apartment complex,’ Akin said.”
“Swaths of vacant land dot downtown streets. Some just happen to be the size of condo developers’ dried up dreams. Now, the big questions are what will be built on the land, and how long will it take to sell it?”
“‘We’ve got places where we could run cattle if we wanted,’ said Wilson Stair, the city’s urban planner.”
The Orlando Sentinel. “Orange County government will buy and fix up as many as 200 foreclosed homes in the next year, and sell them to moderate- and low-income buyers to help clean up neighborhoods worst hit by the mortgage meltdown. A $28 million federal housing grant will pay for the program, which could remove as many as 1,000 homes from the foreclosure ranks before the aid runs out in 2013.”
“Inside Orlando’s city limits alone, 5,000 properties went into foreclosure last year, according to data from Realty Trac. Financial experts say that number could continue growing until next year. ‘This is just a drop in the bucket,’ Commissioner Teresa Jacobs said.”
From WPTV. “At EZ Cash Pawn in West Palm Beach, they don’t need some wall street guru to tell them the economy is tanking. Shop owner Bob Desantis says their shelves are so stacked with electronics, musical insturments, guns, fishing poles, scuba gear - you name it, that they’re having to turn business away. With the housing bust, construction workers come through the door every day, he says, trying to get cash for unused power tools.”
“‘I have to decline it,’ says Desantis, ‘I have no choice. I have tools in the warehouse now. Every single tool you can think about. Electronics, plumbing tools.’”
“At Provident Jewelry and Loan on Clematis Street, store owner Robert Samuels says all kinds of people are coming through his door. ‘It’s crept from the lower and lower middle class to the middle and upper middle class,’ says Samuels.”
The Palm Beach Post. “A mortgage fraud ring used bogus deals for 13 homes in Palm Beach County to steal more than $1 million from lenders, Florida Attorney General Bill McCollum said Wednesday. Using straw buyers, Johnson Cuffy applied for mortgages. Once the loans closed, the straw buyers posed as owners and took home equity lines of credit from the lenders. The participants kept some of the proceeds and moved the rest through nonexistent companies to Johnson Cuffy, McCollum said.”
“Don Suozzo long dreamed of living on the beach. He couldn’t afford it. ‘I’ve been looking to get on the beach for 20 years, and the pricing was absolutely horrendous,’ Suozzo said. ‘The best we found was $300,000 and four or five blocks from the ocean.’”
“Then came the post-boom storm of mortgage defaults, and Suozzo started shopping for deals. In May, he became the proud owner of an oceanfront condo in Highland Beach. He paid $290,000 for the 2,240-square-foot unit. The previous owner paid $782,000 for the unit in 2005, then lost the condo to foreclosure.”
“During the first eight months of 2008, 18,065 properties in Palm Beach County went into some stage of foreclosure, according to the Palm Beach County Clerk and Comptroller’s Office. That’s more than in the previous two years combined.”
“With lenders willing to deal, foreclosures are the most active corner of the housing market, said Laurie Davies, a foreclosure specialist in Boca Raton. ‘Everybody’s looking for a fantastic buy,’ Davies said. ‘A lot of houses are going for 30 percent to 40 percent less than they should be.’”
“And compared to the bubble-inflated prices of 2005 and early 2006, the discounts are even bigger. Davies points to a couple of recent foreclosure sales that sold for half of their previous prices. In Wellington’s Olympia development, a home recently sold for $238,000 after going for $530,000 in 2006. At CitySide in West Palm Beach, a townhouse sold for $180,000 in July after trading for $505,000 in 2006.”
“Professionals in the gambling business have some pretty pointed opinions about the Wall Street titans who brought you the current financial crisis. ‘The problem is they were playing with other people’s money,’ says a stern-faced Alexander Havenick, whose firm runs poker parlors and dog racing tracks in the Miami and Fort Myers areas. ‘Would you do that with your own money?’”
“In Havenick’s business, everyone places his or her own bets, whether on a racing greyhound or three kings. Handing money over to Wall Street middle men with a taste for crumby mortgages has turned out to be a bad wager for the American public, he says.”
“Charles Anderer, publisher of the Casino Journal and Indian Gaming Business magazines, couldn’t agree more. ‘It’s a mug’s game,’ says Anderer, speaking of the state of affairs in the roller-coaster stock market and the other dealings by those financiers. ‘They say Wall Street has been operating like a casino lately, but that’s an insult to the casinos.’”
