Posted on Tuesday, 08.11.2009
Miami-Dade’s Department of Planning and Zoning, Research Section, is publishing a series of brief narratives pertaining to Miami-Dade County. The following are a series of articles pertaining to foreclosures Miami and Miami homes for sale.
Foreclosures Miami - Miami Homes for Sale
Last year Miami Dade’s Department of Planning and Zoning examined housing affordability as it was one of the most pressing concerns facing the County at the time. Miami homes for sale and there values had shot up by more than 170% between 2000 and 2006 and the share of homeowners with mortgages dedicated more than 30% of their income to the payment of selected housing costs had reached 58%.
Plainly, Miami homes for sale were very expensive and not only were buyers stretching their budgets, but thanks to the mortgage lending, they were able to purchase Miami homes considerably more expensive than they could afford. Unfortunately, it turns out that for many, Miami homes for sale were in reality unaffordable. In this first article we take a look at a result of this real lack of housing affordability and the recent downturn in the overall economy, in particular the loss of Miami real estate properties by families and investors due to non-payment of mortgages. The primary factor that sheds light on those not being able to make their mortgage payments is that of foreclosures Miami.
he process regarding foreclosures Miami is one that allows a lender to recover the amount owed on a defaulted loan by selling or taking possession of the property securing the loan. In the foreclosure process there are several steps that begin once the borrower defaults on the mortgage and the lender files a public default notice, called a “Notice of Default” or “Lis Pendens”. This is the pre-foreclosure stage. If the loan is not restored by the end of the pre-foreclosure period the property is taken to a public auction where potential buyers can submit their bids, and if the auction is unsuccessful the lender takes ownership of the property.
Properties held by the lenders are REO’s (Real Estate Owned) and are usually put up for sale on the open market. To gauge the level of foreclosures Miami
activity we employ three different sets of information, each with its strengths and weaknesses. First, we have the number of foreclosure cases filed in court (cases filed). This information is useful as it provides a trend in the volume of foreclosures, but is limited for other purposes because it includes filings related to all property types. Additionaly, there is not necessarily a one-to-one relationship between cases and properties. Some cases might be related to multiple properties and in other instances there are properties that have several cases related to them such as foreclosure filings from a first, second and third mortgage.
Second, we have statistics on foreclosure auctions conducted by the court that also gives us a multi-year trend but also includes all property types. Third, we examine a list of REOs that ended in the hands of the lenders between September 2008 and May 2009. Realty Trac, Inc., a foreclosure monitoring firm, provides us with this data. This dataset is superior for analytic purposes as it is composed solely of residential real estate with corresponding addresses that gives us a clear geographic image of where foreclosures occur. Nevertheless, it does not provide us with useful data to establish trends.