The Real Deal Miami

Florida foreclosure sales down 22 percent

By Alexander Britell | August 24, 2011 11:44PM

Foreclosures sales in Florida dropped 22.4 percent in the second quarter of the year compared to the same period in 2010, according to a report from foreclosure real estate listings database RealtyTrac released today.

There were a total of 34,558 foreclosure sales in Florida in the second quarter, the second-highest number per state in the U.S., with an average sales price of $114,894.

Nationally, foreclosure sales fell 11 percent from the second quarter of 2010, although they saw a 6.48 percent increase from the first quarter of 2011.

What stood out in Florida, a state that has seen a drastic reduction in foreclosure activity since the beginning of the robo-signing scandal, was a greater percentage of short sales, according to Daren Blomquist, RealtyTrac’s spokesperson.

“There are almost as many pre-foreclosure sales as there are real estate-owned sales [in the second-quarter data],” he said. “Usually, the balance had been that there had been quite a few more REO sales.”

Blomquist said lenders were apparently more willing to deal with pre-foreclosure sales — and even take losses up front on the properties — because dealing with maintaining the properties throughout foreclosure, and then taking possession of them, was becoming much less attractive.

The problem of banks holding on to foreclosed properties, especially condominium units, has led owners to look to new legal tactics like mortgage termination to force banks to either move ahead with foreclosures or forfeit their rights over the properties.

Foreclosure sales in Florida closed at an average discount of 33.4 percent off of the sales price of the average non-distressed sale in the state last quarter.

An ongoing question for foreclosure observers has been when the activity will increase — and Blomquist said a national uptick in sales of 6.48 percent from the first quarter could signal a renewed effort by banks to bring foreclosures through the process.

“The fact that more of these properties are selling [nationally] may give lenders and servicers more confidence — and it clears the pipelines,” he said. “It wasn’t a huge increase, but the more [lenders] sell, the more room they have to take on new foreclosures.”