Thursday, July 29, 2010
Starting Tonight: More Than 1500 South Florida Homes Will be Auctioned Off
For more details, click here.
South Florida Ranks #10 in Nationwide Foreclosures
Today, RealtyTrac Inc. announced that South Florida has the nation's 10th-highest foreclosure rate, with 3.89% of homes receiving a notice during the first half of 2010.
In terms of sheer numbers, the Miami metro area, which includes Palm Beach, Broward and Miami-Dade counties, led all regions with 94,466 homes in some stage of foreclosure from January through June. That's off 8% from the previous six months, but up roughly 11% from the first half of 2009.
Florida led with nine communities on the list, including #8 Orlando. Florida, California, Nevada and Arizona accounted for all top 20 metro foreclosure rates.
James J. Saccacio, RealtyTrac's chief executive, indicated that while foreclosures may have peaked in some markets, the lack of job growth could continue to be a drag on housing. Therefore, more foreclosures would lead to more price declines.
In terms of sheer numbers, the Miami metro area, which includes Palm Beach, Broward and Miami-Dade counties, led all regions with 94,466 homes in some stage of foreclosure from January through June. That's off 8% from the previous six months, but up roughly 11% from the first half of 2009.
Florida led with nine communities on the list, including #8 Orlando. Florida, California, Nevada and Arizona accounted for all top 20 metro foreclosure rates.
James J. Saccacio, RealtyTrac's chief executive, indicated that while foreclosures may have peaked in some markets, the lack of job growth could continue to be a drag on housing. Therefore, more foreclosures would lead to more price declines.
Wednesday, July 28, 2010
Fort Lauderdale Foreclosure Lawyer is Being Sued Himself
A Broward County attorney David J. Stern, who handles 20% of all foreclosure cases against Florida homeowners, is being sued himself.
In a complaint filed this week in federal court in Fort Lauderdale, two Ohio residents allege that Stern and DJSP Enterprises, a public company that gets most of its business from Stern's firm, "materially misled" them and other investors about the company's revenue prospects.The suit states specifically, Stern and DJSP were slow to disclose a "substantial decrease" in foreclosure cases referred to Stern's firm by one of its bank clients in April and May.
According to this suite, that drop, along with a slowdown in foreclosures because of government loan modification programs, led to lower-than-expected earnings forecast for DJSP and a nearly 29% plunge in its stock price in a single day.
In January, Stern sold his "nonlegal" operations, such as document preparation, to DJSP for $58 million. The company is registered in the British Virgin Islands but is based in Plantation and gets more than 90% of its business from Stern's law firm. Stern is DJSP's chairman and CEO as well as a major shareholder.
The lawsuit was filed by Stan Cooper and Neeraj Methi on behalf of all investors who bought DJSP stock between March 16 and May 28, when the stock dropped from $8.98 per share to $6.33. It closed Friday at $4.98.
On March 16, the suit says, DJSP filed a statement with federal regulators that included comments Stern had made that day touting the company at a California investors conference.
Noting that the U.S. foreclosure growth rate has averaged 12% annually over the past 25 years, Stern predicted that foreclosures would grow to "historical heights" and remain at "high levels" until 2017. He said DJSP also stood to benefit from helping banks sell millions of repossessed homes and condos.
Stern told investors:
"So no matter what the Obama administration brings our way, we have found the way to create a profit center on it and that I think is part of the success."
On May 27, though, DJSP "shocked the market," the suit says, by announcing it had lowered its 2010 forecast for adjusted net income by up to $17 million. It also disclosed for the first time that one of Stern's bank clients was converting to a new foreclosure data system, resulting in a temporary drop in cases referred to Stern's law firm.
In a complaint filed this week in federal court in Fort Lauderdale, two Ohio residents allege that Stern and DJSP Enterprises, a public company that gets most of its business from Stern's firm, "materially misled" them and other investors about the company's revenue prospects.The suit states specifically, Stern and DJSP were slow to disclose a "substantial decrease" in foreclosure cases referred to Stern's firm by one of its bank clients in April and May.
According to this suite, that drop, along with a slowdown in foreclosures because of government loan modification programs, led to lower-than-expected earnings forecast for DJSP and a nearly 29% plunge in its stock price in a single day.
In January, Stern sold his "nonlegal" operations, such as document preparation, to DJSP for $58 million. The company is registered in the British Virgin Islands but is based in Plantation and gets more than 90% of its business from Stern's law firm. Stern is DJSP's chairman and CEO as well as a major shareholder.
The lawsuit was filed by Stan Cooper and Neeraj Methi on behalf of all investors who bought DJSP stock between March 16 and May 28, when the stock dropped from $8.98 per share to $6.33. It closed Friday at $4.98.
On March 16, the suit says, DJSP filed a statement with federal regulators that included comments Stern had made that day touting the company at a California investors conference.
Noting that the U.S. foreclosure growth rate has averaged 12% annually over the past 25 years, Stern predicted that foreclosures would grow to "historical heights" and remain at "high levels" until 2017. He said DJSP also stood to benefit from helping banks sell millions of repossessed homes and condos.
Stern told investors:
"So no matter what the Obama administration brings our way, we have found the way to create a profit center on it and that I think is part of the success."
On May 27, though, DJSP "shocked the market," the suit says, by announcing it had lowered its 2010 forecast for adjusted net income by up to $17 million. It also disclosed for the first time that one of Stern's bank clients was converting to a new foreclosure data system, resulting in a temporary drop in cases referred to Stern's law firm.
The suite claims:
"As a result of defendants' wrongful acts and omissions, and the precipitous decline in the market value of the company's securities, plaintiffs and other class members have suffered significant losses and damages."
Stern's high-volume practice has made him a controversial figure. You could call him the foreclosure king of Florida.
As lawyer for several major banks, Stern handles one-fifth of all foreclosure cases in the nation's fourth most populous state. It is from Stern's law firm that well over 100,000 Floridians have received the dreaded notice to pay up or face losing their homes.
In March 2010, a Pasco County judge dismissed a foreclosure case after ruling Stern's firm had submitted a clearly fraudulent document.
In 2000, Stern paid $2.1 million to settle a class action suit alleging his firm had overcharged homeowners for title searches and other expenses. And in 2002, the Florida Bar publicly reprimanded him for misleading and overcharging some of his own bank clients.
Despite the reprimand, Stern's law firm ballooned along with the foreclosure rate. From its headquarters in Plantation, it now handles nearly 100,000 foreclosure cases at any one time.
Assignments of mortgage which transfer ownership of a loan from one party to another are key in determining who has the legal right to foreclose. A back-dated assignment could mean that the bank didn't own the note at the time it started foreclosing, or worse, that the assignment was created to show ownership that didn't actually exist.
In an amended registration statement filed with the Securities and Exchange Commission in June, DJSP Enterprises touts Stern's years of legal experience. But the statement does not mention the reprimand, even though the company's business could be affected by state laws and Florida Bar rules.
"As a result of defendants' wrongful acts and omissions, and the precipitous decline in the market value of the company's securities, plaintiffs and other class members have suffered significant losses and damages."
Stern's high-volume practice has made him a controversial figure. You could call him the foreclosure king of Florida.
As lawyer for several major banks, Stern handles one-fifth of all foreclosure cases in the nation's fourth most populous state. It is from Stern's law firm that well over 100,000 Floridians have received the dreaded notice to pay up or face losing their homes.
In March 2010, a Pasco County judge dismissed a foreclosure case after ruling Stern's firm had submitted a clearly fraudulent document.
In 2000, Stern paid $2.1 million to settle a class action suit alleging his firm had overcharged homeowners for title searches and other expenses. And in 2002, the Florida Bar publicly reprimanded him for misleading and overcharging some of his own bank clients.
Despite the reprimand, Stern's law firm ballooned along with the foreclosure rate. From its headquarters in Plantation, it now handles nearly 100,000 foreclosure cases at any one time.
Assignments of mortgage which transfer ownership of a loan from one party to another are key in determining who has the legal right to foreclose. A back-dated assignment could mean that the bank didn't own the note at the time it started foreclosing, or worse, that the assignment was created to show ownership that didn't actually exist.
In an amended registration statement filed with the Securities and Exchange Commission in June, DJSP Enterprises touts Stern's years of legal experience. But the statement does not mention the reprimand, even though the company's business could be affected by state laws and Florida Bar rules.
Tuesday, July 27, 2010
FTC Bans 8 Mortgage Relief Scams
Federal regulators have banned eight individuals and companies from selling mortgage-relief services, settling charges that they used false advertising to deceive homeowners facing foreclosure.
Yesterday, The Federal Trade Commission said that it has ordered the firms and individuals to return $29.2 million in fees that they allegedly collected from clients. However, some of the individuals charged are unable to pay and the agency said it has agreed to suspend $11.5 million in judgments. The settlements were the latest actions against marketers who authorities said exploited distressed homeowners to turn a profit.
Since the housing crisis began, the FTC has brought 29 cases against those who have falsely promised mortgage relief in exchange for hefty fees up front. The agency said it would continue to pursue relief scams. Some of the companies used names that deceived borrowers into believing the firms were participating in the Obama administration's $75 billion mortgage modification effort, known as "Making Home Affordable." FTC officials said at least one of the firms offered primarily online services, so homeowners across the country might have been affected.
In the settlements announced yesterday: Steven Oscherowitz, affiliated with a firm called Federal Loan Modification Law Center, was ordered to pay $11.5 million. The FTC said Oscherowitz's firm received that much from consumers in the alleged scam. His firm charged as much as $3,000 to each client, most of which was required in advance. The firm often failed to deliver loan modifications, the FTC said. In addition to being banned from selling mortgage relief services, Oscherowitz is not permitted to operate telemarketing businesses.
Loss Mitigation Services and Direct Lender were ordered to pay a total $6.2 million. Dean Shafer, Marion Anthony "Tony" Perry and Bernadette Perry were banned from selling the services, but the $6.2 million judgment against them was suspended because of their inability to pay. The FTC said they falsely promised loan modifications if homeowners paid as much as $5,500.
Salvatore and Nicholas Puglia, of Hope Now Modifications and Hope Now Financial Services Corp. were ordered to pay $5.3 million. The FTC said that judgment will be suspended when they surrender all the funds in their bank accounts, which had been frozen by the court.
The agency said the Puglias and the firms falsely claimed they were linked with the federal government's Hope Now program and that they could achieve modifications in nearly all cases — or would refund customers' money.
Monday, July 26, 2010
Habitat for Humanity Looks to Rehabilitate Foreclosed Homes
Through the Stabilization Trust’s national Property Acquisition Program, the two-year partnership will give Habitat affiliates the opportunity to purchase foreclosed and abandoned properties from participating financial institutions on a “first look” basis, before the properties are broadly marketed and listed for sale.
Habitat will then renovate these homes and sell them as affordable housing to low- and moderate-income families. In order to carry out rehabilitations or repairs, many Habitat affiliates will use funding from HUD’sNeighborhood Stabilization Program (NSP), which was established by Congress in late 2008 to help rebuild neighborhoods adversely impacted by high levels of foreclosures and vacancies.
Habitat says it will work through the Stabilization Trust to purchase and renovate hundreds of homes in distressed neighborhoods throughout 2010 and 2011.
“This partnership with the National Community Stabilization Trust is a crucial element in our efforts to revitalize communities across the U.S.,” said Jonathan Reckford, CEO of the Georgia-based Habitat for Humanity International. “By rehabilitating and returning foreclosed or abandoned properties to the affordable housing stock, Habitat for Humanity is providing more opportunities to improve the quality of life for families and creating flourishing communities that are safe and appealing.”
Craig S. Nickerson, president of the National Community Stabilization Trust, added, “As we expand community access to foreclosed and abandoned properties, it is very important that the Stabilization Trust joins forces with a nonprofit leader like Habitat. As a national supplier of affordable housing, Habitat has a proven track record of success at the grassroots level in generating new and renovated homes in partnership with families in need of affordable housing.”
Currently 130 NSP grantees in 40 states are participating in the Stabilization Trust’s program to access the REOinventories of the nation’s largest financial institutions – including Bank of America, Chase, Citi, Fannie Mae, Freddie Mac, GMAC, and Wells Fargo.
The option of having “first look” at properties through the Stabilization Trust program is an important tool for many local housing providers undertaking neighborhood stabilization efforts, as it enables them to quickly identify and acquire properties that may be critical to reversing downward neighborhood trends.
“The ability to purchase foreclosed houses before they hit the open market positions Habitat to make a bigger impact in communities hardest hit by the foreclosure crisis,” said Stephen Seidel, senior director global programs for Habitat for Humanity International. “We are excited for the opportunity to help rebuild communities which have been negatively impacted by the foreclosure crisis, while assisting people in need of affordable housing.”
Sales Come to a Halt at Trump Hollywood
Last August, developer Jorge Perez said he had lined up buyers for more than two-thirds of the condos at the 40-story oceanfront project he built with developer Donald Trump.
Peter Zalewski, principal of CondoVultures.com, said similar developments along Hollywood beach are selling for an average of nearly $400 a square foot. But the average price per square foot so far at Trump Hollywood is $616. Zalewski stated: "There's no question that Trump Hollywood is an anomaly in that market, and that's why sales have been so slow."
Tessa Solomon, a sales associate at Trump Hollywood, said the development has 20 completed sales. However, at this time, only four have been recorded with Broward County.
Zalewski also noted that Perez quickly closed sales at his lavish Icon Brickell condo in downtown Miami after beginning price cuts last fall, and potential buyers at Trump Hollywood are counting on the same thing happening there.
Other Perez and Trump projects have struggled amid one of the worst condo downturns in decades. Perez has handed back to lenders the CityPlace South Tower in West Palm Beach and most of Icon, while the unfinished Trump International Hotel & Tower, a condo-hotel in Fort Lauderdale, faces foreclosure.
From 2000 to 2005, investors would buy units in buildings at pre-construction prices and then flip them for huge profits before the condos were completed. The demand caused developers to build more units. But not enough long-term owners bought, leaving investors and developers in financial peril.
According to the Florida Realtors, over the span of 2 years, condo sales have increased while prices have plummeted. The median price for an existing condo in Broward last month was $78,600, a 64% slide from a peak of $216,800 in February 2006.
Greg McBride, senior financial analyst with Bankrate.com stated: "Buyers are definitely looking for bargains."
Trump Hollywood's 16 closings total $28.7 million, for an average sale price of about $1.8 million. Marketing materials last year indicated the condos, which feature Italian cabinetry and wine refrigerators, ranged from $1.3 million to $7 million.
Zalewski concluded that while bulk buyers are snapping up largely empty condo projects across South Florida, a bulk sale probably won't happen at Trump Hollywood. This is because the units are too large, with the smallest at about 1,900 square feet. Therefore, the deal wouldn't make financial sense.
Friday, July 23, 2010
Foreclosures on the Rise
Even though South Florida home sales rebounded in June, analysts and real estate agents still wonder whether the housing market is destined for another downturn.
Yesterday, Florida Realtors stated that Broward County had 844 sales of existing homes last month, up 15% from May. Compared with June 2009, Broward sales declined 2%.
In Palm Beach County, 1,087 homes traded hands, up 23% from May and 27% from a year-ago June. It was the county’s busiest month for home sales since March 2005, near the peak of the housing boom.
The June figures were bolstered by house hunters rushing to qualify for $8,000 and $6,500 federal tax credits. Originally, buyers who signed contracts by April 30 would be eligible for the rebates if they closed by June 30, but Congress later extended that deadline until the end of September.
Across the region, sales have been rising for the past two years, fueled by affordable prices and historically low mortgage rates. The surge of activity helped sustain prices at the start of 2010, prompting growing optimism after one of the worst tailspins in decades.
But expiration of the government tax credits could have a greater effect on housing demand than first thought, particularly as the nation’s economy appears more fragile in recent weeks. Without significant job growth, consumers will be reluctant to buy homes.
Boca Raton broker Frank Thomas said he and other agents don’t want to believe another housing slump – a “double dip” -- is possible.
“But we’re starting to get suspicious,” he said.
Broward’s median price in June was $209,600, down slightly from May but up 2% from $204,800 a year ago.
Palm Beach County’s median was $232,700, down from May and off 7% from $250,300 in June 2009.
Meanwhile, existing condominium sales rose in both counties, while the median prices declined.
Broward’s median condo price was $78,600, down 6 percent from a year ago. Palm Beach County’s median of $94,800 fell 19% from last June. The median means half sold for more, half for less.
Many of the home and condo sales in Broward and Palm Beach counties involve properties in some stage of foreclosure, a drag on the market.
Statewide, June home sales rose 8% from May and 15% from a year ago. While nationally, June sales fell 5% from May.
Declining inventories of unsold homes have helped the housing picture over the past year, but analysts say the stock of for-sale homes is starting to inch up again. In many cases, homeowners hoping for better market conditions can’t wait any longer and are forced to list their homes.
Yesterday, Florida Realtors stated that Broward County had 844 sales of existing homes last month, up 15% from May. Compared with June 2009, Broward sales declined 2%.
In Palm Beach County, 1,087 homes traded hands, up 23% from May and 27% from a year-ago June. It was the county’s busiest month for home sales since March 2005, near the peak of the housing boom.
The June figures were bolstered by house hunters rushing to qualify for $8,000 and $6,500 federal tax credits. Originally, buyers who signed contracts by April 30 would be eligible for the rebates if they closed by June 30, but Congress later extended that deadline until the end of September.
Across the region, sales have been rising for the past two years, fueled by affordable prices and historically low mortgage rates. The surge of activity helped sustain prices at the start of 2010, prompting growing optimism after one of the worst tailspins in decades.
But expiration of the government tax credits could have a greater effect on housing demand than first thought, particularly as the nation’s economy appears more fragile in recent weeks. Without significant job growth, consumers will be reluctant to buy homes.
Boca Raton broker Frank Thomas said he and other agents don’t want to believe another housing slump – a “double dip” -- is possible.
“But we’re starting to get suspicious,” he said.
Broward’s median price in June was $209,600, down slightly from May but up 2% from $204,800 a year ago.
Palm Beach County’s median was $232,700, down from May and off 7% from $250,300 in June 2009.
Meanwhile, existing condominium sales rose in both counties, while the median prices declined.
Broward’s median condo price was $78,600, down 6 percent from a year ago. Palm Beach County’s median of $94,800 fell 19% from last June. The median means half sold for more, half for less.
Many of the home and condo sales in Broward and Palm Beach counties involve properties in some stage of foreclosure, a drag on the market.
Statewide, June home sales rose 8% from May and 15% from a year ago. While nationally, June sales fell 5% from May.
Declining inventories of unsold homes have helped the housing picture over the past year, but analysts say the stock of for-sale homes is starting to inch up again. In many cases, homeowners hoping for better market conditions can’t wait any longer and are forced to list their homes.
Thursday, July 22, 2010
Programs in Broward, Palm Beach Counties Seek to Ease Backlogs
Yesterday, Chief Judge Victor Tobin stated at a press event touting the new program: "The point is to bring everybody together and with a serious tone, to see if the loan can be renegotiated and we not have somebody else fall into foreclosure"
The American Arbitraition Association, which is running the mediation program, has set up 23 mediation rooms in an office building across from the Broward County main courthouse. With a staff of five, the AAA's Rebecca Storrow says she can call on a roster of 250 court-certified mediators to handle the negotiations.
According to Storrow, the main objective is to complete mediation withinn 120 days of the start. About 500 cases a week are currently being filed – with about 1/3 of those for properties that are not owner-occupied. The mediation program is only for properties that have a homestead exemption.
According to Storrow, the main objective is to complete mediation withinn 120 days of the start. About 500 cases a week are currently being filed – with about 1/3 of those for properties that are not owner-occupied. The mediation program is only for properties that have a homestead exemption.
June Home Sales in Palm Beach & Broward Counties are Up
Broward County reported 844 sales of existing homes last month, up 15% from May, the Florida Realtors said Thursday. In Palm Beach County, 1,087 homes were sold, a 23% increase from May.
While the June figures were surprising, industry analysts expect the end of the tax credits and a lack of job growth to hurt housing demand in the second half of the year.
Compared with a year ago, Broward sales declined 2%, while Palm Beach County had a 27% increase. Median prices in the two counties were mostly down but remained stable. Broward’s median in June was $209,600, down slightly from May but up 2% from a year ago.Palm Beach County’s median was $232,700, down from May and off 7% from June 2009.
Craigslist Scheme Preying on South Florida Renters
One variant of the scam uses photos of real homes for rent, but at steeply reduced prices. The contact information may include the true homeowner's name or other legitimate information to camouflage the fraud from even savvy searchers. But terms of the bargain-basement lease are typically the same; send the money, we'll send you the keys.
Laura Pearlman, a Realtor with Signature Service Realty in West Palm Beach who works with rentals, said the rental market has swelled with increases in foreclosures and trouble getting loans.She regularly receives bogus e-mail responses when she posts a "housing wanted" request. Pearlman states: "Unscrupulous people know how hot the rental market is right now and they are preying on the unwitting public. They know this is just another niche for them to make money."
Pearlman said the scammers often claim to be missionaries or other aid workers, who are stationed out of the country and need to rent their home. Furthermore, their e-mails are sprinkled with "God bless you's," and the alleged preference that the tenant has "the fear of God." One victim, O'Hagan, who recently got caught up in this scam when she tried to rent her four-bedroom Royal Palm Beach home on Craigslist. She states: "It's so awful because they use all this religious talk. It's just cowardly."
O'Hagan and her husband Brian are moving north to be closer to family and higher-paying jobs. With it unlikely they could sell the home for what they paid, they decided to try and rent it for $2,300-a-month. However, someone claiming to be Brian, with the e-mail address Briant.ohagan@yahoo.com, posted the home's photos on Craigslist with a price of $1,000 per month. He then sent interested renters a contract, with requests for Social Security numbers and other personal information.
O'Hagan's Realtor Craig Fialkowski, who listed their home, said recognized the con when he was contacted by a woman who found both listings -- the one for $1,000 and the one for $2,300 -- and noticed the photos were the same.
Turned out it was too late. Seven people (some even with contracts in hand!), showed up at the O'Hagans' home. Seeing the house occupied, they knocked on the door and found out the ad they were responding to was fake. Craigslist, which did not return an e-mail request for comment, clearly posts scam warnings on its listings, including advice to avoid dealing with a landlord or owner who is out of the country or cannot meet you in person.
Wednesday, July 21, 2010
Banks Foreclose on 400 Homes a Month
The region’s foreclosures represent an 83% year-over-year increase for the tri-county area of Miami-Dade, Broward, and Palm Beach.
Also, according to the report based on Circuit Court records from each county. Miami-Dade led the surge, experiencing a 125% spike in REOs on a year-over-year basis. Palm Beach experienced a 112% jump while Broward’s foreclosures increased 42%.
At the current rate, Condo Vultures says nearly 50,000 homes will be repossessed in South Florida this year, which would significantly outpace the modern-day high of 30,400 repossessions that lenders took control of in 2009. Banks repossessed nearly 26,250 properties in 2008 after taking title to 10,100 properties in 2007.
Peter Zalewski, a principal with Condo Vultures, states:
“South Florida’s real estate market is at a crossroads. The number of bank repossessions in 2010 is higher than at any time in at least two decades. This additional bank-owned inventory will undoubtedly be coming onto the resale market in the near future as discounted REO product. The flip side is, the number of new foreclosure filings in South Florida is down 34% in the first half of the year, putting the region on pace for less than 70,000 actions in 2010 compared to 97,000 in 2009.”
According to Condo Vultures, despite the spike in repossessions, REOs still represent only about 6% of the 67,000 residences on the resale market in the tri-county South Florida region as of July 12.
Market conditions aside, the company says one key reason the number of bank repossessions has increased this year is the implementation of a new online auction technology being used by the South Florida circuit courts to clear the backlog.
“South Florida’s real estate market is at a crossroads. The number of bank repossessions in 2010 is higher than at any time in at least two decades. This additional bank-owned inventory will undoubtedly be coming onto the resale market in the near future as discounted REO product. The flip side is, the number of new foreclosure filings in South Florida is down 34% in the first half of the year, putting the region on pace for less than 70,000 actions in 2010 compared to 97,000 in 2009.”
According to Condo Vultures, despite the spike in repossessions, REOs still represent only about 6% of the 67,000 residences on the resale market in the tri-county South Florida region as of July 12.
Market conditions aside, the company says one key reason the number of bank repossessions has increased this year is the implementation of a new online auction technology being used by the South Florida circuit courts to clear the backlog.
Zalewski concludes:
“The unknown is how many of the more than 240,000 foreclosure filings initiated in South Florida since January 2007 are going to end up as bank repossessions. Right now, the ratio for repossessions-to-foreclosure-filings is about 38% and climbing.”
“The unknown is how many of the more than 240,000 foreclosure filings initiated in South Florida since January 2007 are going to end up as bank repossessions. Right now, the ratio for repossessions-to-foreclosure-filings is about 38% and climbing.”
New Bill: HR 1264
Rep. Gene Taylor, D-Miss., has said he sponsored the bill, HR 1264, because he thinks the federal government can do a better job and charge less for hurricane insurance than private insurers.
The bill's proponents include the National Association of Realtors. Opponents include insurance industry trade groups, a free market think tank and the Consumer Federation of America.
Bob Hunter, insurance director for the Consumer Fed, said his group supports the idea of making hurricane coverage more widely available but says the Taylor proposal would encourage more construction in hurricane-prone areas.
Hunter wrote in a letter to lawmakers:
"Moreover, requiring one of the most incompetent federal agencies in recent history -- the Federal Emergency Management Agency -- to supervise the adjustment of both flood and wind claims –– would be a recipe for disaster for many homeowners and taxpayers."
Hunter wrote in a letter to lawmakers:
"Moreover, requiring one of the most incompetent federal agencies in recent history -- the Federal Emergency Management Agency -- to supervise the adjustment of both flood and wind claims –– would be a recipe for disaster for many homeowners and taxpayers."
Mike Becker, a director of the Professional Insurance Agents stated:
"Coverage for wind damage is available in the private market and through state wind pools. Adding this to the NFIP would place undue burdens on the program and would be another example of the federal government taking control of an insurance product, all while undermining the private market."
"Coverage for wind damage is available in the private market and through state wind pools. Adding this to the NFIP would place undue burdens on the program and would be another example of the federal government taking control of an insurance product, all while undermining the private market."
Tuesday, July 20, 2010
LeBron James Purchases $50 Million Home in Miami
According to reports, James is now the proud owner of a $50 million dollar mansion that was once owned by famed NBA coach Pat Riley.
The home which is tucked in the exclusive Coral Gables community has over 880 feet of water surrounding the property as well as holsters a whopping 8 bedrooms and 11 bathrooms.
The total amount of property that King James has acquired is 20,862 square feet.
Why Aren't More People Getting a Permanent Loan Modification in South Florida?
Why aren't more people getting a permanent loan modification in South Florida?Overall, the loan mod picture is still very busy, yet borrowers in South Florida continue to drop out of the Obama administration’s Making Home Affordable program.
South Florida’s metro areas had more loan modifications than any other cities in the nation in June – which is the same as in May. Statewide, Florida’s number of troubled loans getting new terms was second only to California, also unchanged.
But what’s new: Fewer South Florida borrowers had a permanent loan modification than in May. That’s the opposite of what’s happening nationwide.
The Making Home Affordable permanent modifications “are on pace and sustainable for the homeowner, as more than 50,000 trial agreements graduated to permanent in June and default rates remain low,” the Treasury’s statement says.
According to the Treasury’s report released today:
The Miami-Fort-Lauderdale-Pompano-Beach metro area had 35,621 trial and permanent loan modifications underway in June, down from almost 38,500 in May.
Orlando-Kissimmee had 15,130, down from more than 16,000 in May.
Add those two metro areas together and they account for 6.7% of all loan modification activity nationwide. That proportion is greater than Los Angeles, with 6.5%, New York, with 6% and Chicago, with 5.1% of all loan modifications nationwide under the Obama administration’s program.
The two also accounted for more than half of all loan modifications in Florida.
Only California was busier when it came to trouble mortgage modifications. In California, there were 168,155 loan modifications underway last month, compared to 92,754 in Florida.
Among lenders, Bank of America has produced the largest number of permanent loan modifications, 72,232 nationwide. JP Morgan Chase reported 54,722 loan modifications.
The Treasury said there were 389,198 nationwide permanent modifications were reported in June, up from 340,459 in May.
Bank of America Sets Up New South Florida Office to Help Homeowners
Bank of America is due to open its first customer outreach center in Florida tomorrow.
So far, in the midst of the mortgage meltdown in South Florida, it has been impossible for a borrower looking for help with a mortgage to have a face-to-face conversation with a "homeownership retention specialist" at one of Florida's largest lenders - until now.
This will be BofA's seventh such office nationwide and they claim it will have also associates there who can "help customers facing hardship with their auto, credit cards and personal loans."
To make an appointment, please call 954.308.9592.
The new center in Fort Lauderdale will be open from 10 a.m. to 7 p.m. on weekdays and starting this weekend, 10 a.m. to 2 p.m. on Saturdays.
Drop in New Housing Units is More Evidence of Stagnant Market
Today, the government said housing starts nationwide fell to their lowest level since October, a day after the National Association of Home Builders reported declining confidence among its members.
Builders started work on 549,000 homes in June, down 5% from May and off 6% from a year ago.
The housing market enjoyed a brief upswing this spring, fueled by the $8,000 and $6,500 tax credits for first-time buyers and existing homeowners who purchase new residences.
But not only have those credits expired as of April 30, but the economy has soured as well. So housing analysts who thought the market was turning around have instead reversed course, predicting more softness until the job market and the economy improve.
Monday, July 19, 2010
Broward County Has Florida's Third Highest Foreclosure Rate
Last week, RealtyTrac Inc. reported Broward County had the third-highest foreclosure rate among Florida's 67 counties for the first half of 2010. One in every 21 Broward homes received a foreclosure notice during the January-to-June period.
The county had 37,988 homes in some stage of foreclosure, down 10% from the second half of 2009. Palm Beach County had 18,083 filings in the first half of the year, essentially unchanged from the second half of 2009. The county had the state's 19th-highest foreclosure rate.
Florida ranked second behind California with 277,073 properties receiving a foreclosure filing. The pace of properties entering foreclosure has slowed as lenders try harder to seek loan modifications and short sales.
The county had 37,988 homes in some stage of foreclosure, down 10% from the second half of 2009. Palm Beach County had 18,083 filings in the first half of the year, essentially unchanged from the second half of 2009. The county had the state's 19th-highest foreclosure rate.
Florida ranked second behind California with 277,073 properties receiving a foreclosure filing. The pace of properties entering foreclosure has slowed as lenders try harder to seek loan modifications and short sales.
Housing Recovery Stalls as Home Builder Index Declines
The National Association of Home Builders said its market index declined to 14 in July from 16 in June. That's the lowest level since April 2009.NAHB Chairman Bob Jones stated:
"We continue to see a lull in home buying activity following the expiration of the federal home buyer tax credit program, as many of the sales that would have occurred this summer were likely pulled forward to meet that program's deadline. In addition, builders are reporting continuing consumer hesitancy regarding home purchases due to uncertainty in the overall economy and job markets."
The Florida Realtors will report June sales and prices for existing homes on Thursday, July 22. Given what we’ve seen recently, it doesn’t appear those statistics will be particularly impressive.
Mike Larson, a housing analyst for Weiss Research in Jupiter, concludes:
“With growth slumping again, and unemployment hovering near the double digits, we simply don't have the necessary ingredients for a sustainable recovery in housing."
Wednesday, July 14, 2010
Lenders Plan to Take Back Nearly 50,000 Properties This Year
According to a report by CondoVultures yesterday, Lenders are repossessing foreclosed homes in South Florida at a faster rate and are on track to take back nearly 50,000 properties this year.This increase, from 30,400 repossessions last year, stems in part from the migration of the foreclosure sales process to the internet.
Peter Zalewski, principal of CondoVultures.com, states:"The online auctions are providing a certain cleansing process."
During the first half of 2010, banks took title to an average of 4,000 properties a month in Miami-Dade, Broward and Palm Beachccounties — an 83% increase over the same period of 2009.
Online foreclosure auctions began this year in Miami-Dade, Broward and Palm Beach counties. Previously, auctions were held in person at the county courthouses.
Florida is the first state in the nation to put foreclosure sales online, after a change in state law in 2008.
Lloyd McClendon, chief executive of RealAuction.com (the Plantation-based company runs the online auctions in Broward, Miami-Dade and 15 other Florida counties) thinks the online auctions are speeding foreclosure sales and helping to clear the backlog of cases. He said the increase in bank repossessions also is a result of a new rule in Miami-Dade, Broward and Palm Beach counties that requires a court order to cancel a foreclosure auction.
But Zalewski said there is reason for optimism. He points out that South Florida foreclosure filings are down 34% in the first half of 2010, an indication that the housing market is poised to improve after a devastating downturn that has extended into a fifth year.
Typically, a lender files a foreclosure notice when a homeowner is 90 days past due on the mortgage. If the homeowner can't work out a deal to stay in the home, the lender takes back the property through a foreclosure auction.
West Palm Beach housing analyst Brad Hunter said the decline in foreclosure filings signals the winding down of the subprime mortgage debacle affecting borrowers with poor credit histories. But Hunter expects foreclosures to spread to more middle- and upper-income homeowners who didn't take out subprime mortgages.
Peter Zalewski, principal of CondoVultures.com, states:"The online auctions are providing a certain cleansing process."
During the first half of 2010, banks took title to an average of 4,000 properties a month in Miami-Dade, Broward and Palm Beachccounties — an 83% increase over the same period of 2009.
Repossessions soared 125% in Miami-Dade, 112% in Palm Beach County and 42% in Broward. The number is higher than at any time in the past 20 years, Zalewski said.
If lenders close in on 50,000 South Florida repossessions in 2010, it would shatter the modern-day record set in 2009.
If lenders close in on 50,000 South Florida repossessions in 2010, it would shatter the modern-day record set in 2009.
Online foreclosure auctions began this year in Miami-Dade, Broward and Palm Beach counties. Previously, auctions were held in person at the county courthouses.
Florida is the first state in the nation to put foreclosure sales online, after a change in state law in 2008.
Lloyd McClendon, chief executive of RealAuction.com (the Plantation-based company runs the online auctions in Broward, Miami-Dade and 15 other Florida counties) thinks the online auctions are speeding foreclosure sales and helping to clear the backlog of cases. He said the increase in bank repossessions also is a result of a new rule in Miami-Dade, Broward and Palm Beach counties that requires a court order to cancel a foreclosure auction.
McClendon states:
"More cases are going to sale on schedule. It's less playing around."
The inventory of bank-owned homes is expected to flood the resale market in the coming months, almost certainly hurting prices that have stabilized recently.
The inventory of bank-owned homes is expected to flood the resale market in the coming months, almost certainly hurting prices that have stabilized recently.
But Zalewski said there is reason for optimism. He points out that South Florida foreclosure filings are down 34% in the first half of 2010, an indication that the housing market is poised to improve after a devastating downturn that has extended into a fifth year.
Typically, a lender files a foreclosure notice when a homeowner is 90 days past due on the mortgage. If the homeowner can't work out a deal to stay in the home, the lender takes back the property through a foreclosure auction.
West Palm Beach housing analyst Brad Hunter said the decline in foreclosure filings signals the winding down of the subprime mortgage debacle affecting borrowers with poor credit histories. But Hunter expects foreclosures to spread to more middle- and upper-income homeowners who didn't take out subprime mortgages.
Hunter concludes: "I think it's premature to say we're out of the woods. The housing recovery is going to depend on jobs, and so far we haven't seen an increase in jobs."
Tuesday, July 13, 2010
Vote NO on Amendment 4
As high unemployment continues to plague the state of Florida, working families and small business owners have been disproportionately affected. In the midst of such vulnerable economic times, the last thing Florida needs is an amendment that would raise taxes, kill jobs, and promote endless litigation at the taxpayer's expense.However, that is exactly what Amendment 4 would do. This “Vote on Everything” amendment would force taxpayers to fund expensive referenda for every technical change to their local comprehensive plan.
Its proponents claim that this initiative simply empowers Floridians to make decisions on land use issues, however, Amendment 4 is far from simple. A local version of Amendment 4 was implemented in the small town of St. Pete Beach in 2006. Since then, the city has experienced chaos and confusion regarding a new growth management process that has made smarter, well-coordinated growth impossible.
The St. Petersburg Times says that the measure has been “divisive, expensive, and an impediment to much needed growth.” Worse still, taxpayers in St. Pete Beach have been burdened with over a half-a-million dollars in legal fees that decimated the city budget. When voters approved four pro-growth amendments in the hopes of improving economic conditions, Amendment 4 lawyers sued to overturn the will of the people.
The St. Petersburg Times says that the measure has been “divisive, expensive, and an impediment to much needed growth.” Worse still, taxpayers in St. Pete Beach have been burdened with over a half-a-million dollars in legal fees that decimated the city budget. When voters approved four pro-growth amendments in the hopes of improving economic conditions, Amendment 4 lawyers sued to overturn the will of the people.
If taken statewide, Amendment 4 would make St. Pete Beach look mild by comparison. Under this measure, it would not be uncommon for voters to face 200 to 300 minor plan revisions each year. The enormous cost of these taxpayer funded elections, coupled with expensive litigation, will result in higher taxes for all Floridians.
Furthermore, a recent study by Tony Villamil of the Washington Economic Group, indicates that Amendment 4 would result in $4 billion of lost state and local tax revenue due to forgone economic development projects.
The facts indicate that Amendment 4 would result in higher taxes and fewer jobs in a time when our economy is most vulnerable. Simply put, Florida cannot afford Amendment 4. Vote no on Amendment 4.
Monday, July 12, 2010
Allstate ~ Florida's 6th Largest Insurer ~ Proposes 33% Rate Increase
The Allstate Floridian Insurance companies, which changed names to Castle Key last year, have about 250,000 policies, making Allstate Florida's 1/3 largest private home insurer. Nearly 3/4 of those policies are with Castle Key Insurance, which on its own is the sixth largest insurer after state-backed Citizens Property Insurance, State Farm Florida, Universal Property & Casualty, St. Johns and USAA. The rest of the Allstate policies are with Castle Key Indemnity, which has asked for an 18% statewide average rate hike.
Allstate Insurance spokeswoman Amy Moore said the average increase for Castle Key Insurance works out to $412, or $34 a month, for policy holders and the average increase for Castle Key Indemnity works out to an extra $243, or $20 a month.
Moore said the increases are needed to build the companies claims-paying reserves because premiums aren't keeping pace with costs, including back up coverage expenses and claims costs after fires, theft and other issues. She states: "Castle Key has not received a significant rate increase in nearly five years. We need to maintain adequate capital to remain strong and positioned to deliver on our promise to customers. Losses and expenses have exceeded premium and this is projected to continue without a rate increase."
After an Office of Insurance Regulation investigation of Allstate, the company struck an agreement with regulators in 2008 to sell 100,000 new policies, pay a $5 million fine, reduce homeowner insurance premiums statewide by 5.6% and forgive a $175 million loan to its Florida subsidiaries.
Former state Rep. Don Brown, criticized regulators for releasing a statement during the last week of the legislative session this year saying that Castle Key may take 50,000 policies from Citizens insurance without mentioning the policies are part of the 100,000 Allstate was required to take.
Brown, an insurance agent, said he wonders if Allstate agreed to take half of the polices from Citizens to butter up to regulators before asking to raise rates.
Castle Key Indemnity, the Allstate subsidiary that asked for the smaller rate hike request, is the one selling new policies. Moore said it is considering taking policies from Citizens in 2011 at the earliest.
The OIR hearing on the Castle Key companies' rate proposals will be held in Tallahassee on July 27, the day after Citizens' board plans to meet to discuss its own rate hike request. Citizens, Florida's largest property insurer, can raise policyholders' premiums by up to 10% a year under a state law passed last year.
64 Units at Las Olas by the River Rumored to be Largest Bulk Purchase of Condos in Fort Lauderdale History
In a deal rumored to be the largest bulk condo purchase in Fort Lauderdale, 64 units at Las Olas by the River were purchased earlier this month for $10.2 million. Fernando Levy-Hara, a managing partner of The McKafka Group, said his firm completed the purchase on July 2 in a deal with Montecito Property Co., a California-based developer. The McKafka Group is a joint venture between European investors and Aventura-based G&D Developers.Peter Zalewski from Condo Vultures, said the deal represents the biggest bulk condo purchase in Fort Lauderdale.
According to Levy-Hara. Of the 64 units, 62 are two- and three-bedroom units and the remaining units are models for display. The total amount of salable space is 79,607 square feet, which breaks down to a short-sale price of $164,516 per unit ~ about $130 per square foot.
Levy-Hara also states that the building was in pre-foreclosure and a short sale of the properties was approved by the building's lender, Bank of America. The Montecito Property Co. declined to comment on the transaction.
The 240-unit Las Olas by the River was built in 2005 along the New River. It is within walking distance of the Riverwalk arts and entertainment district and parts of downtown Fort Lauderdale. The website claims the design is inspired by Mediterranean architecture, .
Levy-Hara said the units were appealing because of the building's location and age and because the developer-owned units are occupied by renters. He states: "The building is good, the location is good, and we know we can sell these [units]."
He also added that such condo surpluses are rare in Fort Lauderdale, compared to Miami.
Levy-Hara concluded:"[Foreign investors] are looking for a stable economy. Believe it or not, the US is stable compared to the rest of the world."
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