Vero Beach Foreclosures

Homes advertised as Short Sales are currently 30-40% of all homes for sale in Indian River County. The percentage varies by location and price range, with the majority being at $100k to $400k list price. Homes built during the 2003-2006 construction boom in Vero Beach are most likely to be in this category.

A Short Sale is when the lender agrees to discount their payoff to allow a sale and the following conditions are met for a Vero Beach Short Sale:

• The mortgage is delinquent or in default (pre-foreclosure)
• The home’s value is less than the mortgage balance
• The home owner/seller can demonstrate a financial hardship

If these conditions are met, the seller benefits by:

• Avoiding Foreclosure and having their credit score ruined for 10 years
• Staying in the home during the sales process and not making payments
• Feeling that they have made the best of a bad situation, doing the right thing.

You as a potential buyer benefit because:

• The home is usually better maintained than a foreclosure
• The price is adjusted to current market value and available for sale

The Lender benefits from:

• Avoiding additional expense of Foreclosure and eviction
• Avoiding vandalism and liability for an abandoned home
• Removing bad debts from their books more quickly

How a short sale transaction is different from a conventional sale:

• The lender must approve the sales price and can take more than a month to respond
• The home will always be sold “as is” with right to inspect but no repairs will be made
• Low offers are typically ignored rather than responded to with a counter offer

The process of short sale processing is still evolving but has improved dramatically from last years chaos. They have gotten a bad reputation but with Certified Short Sale Professional as your buyers agent, you can buy a home at half of it’s 2005 sale price.

Please take a look at some of the opportunities and positive indicators for the future of Indian River County, real estate market.

1. Great prices – Statewide, home prices have fallen about 20 percent in the past year. FAR (Florida Association of REALTORS) statistics show the existing-home median sales price was $185,400 in the third quarter of 2008, compared with $233,200 in third quarter 2007. (The median is a typical market price where half the homes sold for more, half for less.)

2. The time is right – Home sales volumes are rising again – a signal that the market recovery may be underway. In third quarter 2008, statewide sales of existing single-family homes were up 5 % compared to the same period last year. Vero Beach homes for sale had similar results.

3. High inventory levels – Conditions are ideal for buyers to find their dream home. Inventory is plentiful in all price ranges. But as sales volumes increase, inventory levels are likely to shrink. That reality translates into this advice for buyers: Don’t wait too long.

4. Low mortgage rates – Mortgage rates are still at the lowest levels since the 1960s. Lower rates multiply a buyer’s financial power. Even half a percent can make a sizeable difference. For example, on a $200,000 home, half of 1 percent could save the homeowner about $815 a year.

5. Incentives to buy – Federal, state and local housing programs can help buyers make that big purchase. The first time home buyer tax credit is being increased to $8,000 and doesn’t
Have to be paid back if you live in the home for 3 years. The deadline is also being extended to December 2009.

6. A favored retirement destination – Over the long term, Vero Beach, Florida stands to benefit from the migration of the aging Baby Boomer generation, roughly 80 million strong. Demographic studies show that the Sunshine State’s mild climate and outdoor amenities continue to make Florida a favorite retirement destination.

7. A diverse economy – Florida’s economy, like that of the rest of the nation, is impacted by the recession. Some business sectors, though, appear promising for the Florida economy. The healthcare and technology sectors are quickly becoming an important economic force on the Treasure Coast.

8. Investment Outlook – Investors are returning to the Real Estate market as the holding costs of rental homes, due to the decrease in prices and low interest rates, is well below potential income.

9. Homeownership has value – Realtors believe – and research supports that belief – that homeownership provides a variety of tangible and intangible benefits to the community and homeowners. Studies show that home equity is still the largest single source of household wealth.

10. An unsurpassed lifestyle- Finally, let’s not forget the things that brought people to Vero Beach, Florida in the first place, and will continue to attract them – beautiful beaches, fabulous weather and a friendly business climate, with no state income tax

A pilot project recently introduced by Fannie Mae will hopefully reach Vero Beach Foreclosures, but for now is limited to Orlando and Phoenix. By pre-approving a “short sale” the lender would agree to a payoff less than the mortgage before the home is listed. This could improve the popularity of short sales as they now have a reputation of slow approval times and difficult negotiations.

Most lenders are in the process of streamlining the process but are at times overwhelmed by the number of requests. Sellers with distressed homes in Indian River County can greatly improve their chances of avoiding foreclosure by negotiating with their lenders ASAP. This includes homes used for Rental Income in Vero Beach

Using an agent who is experience with the “short sale” process and looking for a home with a bank approved listing price simplifies the purchase. It not only helps the seller avoid foreclosure, but also allows the buyer to get a great deal on a home that hasn’t been neglected as is the case with many foreclosures.

With home prices decreasing and interest rates holding at historically low levels, the number of potential homebuyers who can afford to buy new and existing homes has reached the highest level in more than four years.

According to the third-quarter statistics, 56 percent of all new and existing homes sold were affordable to families earning the national median income of $61,500 – far more than the 40 percent of families who could afford Vero Beach homes at the peak of the housing boom.

“If there is a silver lining to this crisis, it would be that some housing markets have become more affordable with a larger inventory to choose from,” said NAHB Chairman Sandy Dunn. First time home buyers can benefit from a $8,000 tax credit due to expire next December. Investors are also returning to the market in anticipation of increasing home prices and interest rates.

Vero Beach, Fl realtors are citing a Manpower Employment Outlook Survey that predicts growth in construction, manufacturing and retail jobs. Balmy weather, low property taxes, and a cost of living 3 percent lower than that of nearby West Palm Beach make this coastal town an affordable alternative, with sandy shores and the best surfing on the East Coast. Foreclosures and Short Sales may be driving the lower home prices and increase in sales of Vero Beach houses.

Creative investors are profiting from a new housing niche – no longer are they buying, repairing and “flipping” homes to the retail market. They are taking a longer term approach to allow the market to recover and profit in the interim by offering financing. With a record number of Foreclosures and short sales in Vero Beach Fl, there are many opportunities to invest in.

There are buyers in every market, the only problem is many good buyers won’t qualify for a bank loan under the new lending guidelines. Some investors are deciding to hold the mortgage themselves for up to five years. By doing so, they make some extra money and ensure the sale of their rehabbed property went through. At 8 percent interest, an investor can plan to make an extra $10,000 in interest in addition to proceeds from the sale of the house.

While you may have buyers that many banks would probably reject, and take a smaller down payment than most financial institutions, you can sell for more in any market. Find somebody with halfway decent credit and a steady job, write a binding legal contract, and be sure the home is properly insured. Even though you are charging higher interest, you are offering homes that buyers can afford, something most banks didn’t do before with sub-prime mortgages.

Lou Harris a Vero Beach real estate agent, said that in today’s tough housing market, offering homes with owner financing gives sellers an edge. “Depending on the area, it can be critical and the difference between making a sale and not,” said Harris, who advises investors on Vero Beach foreclosures and short sales.

Owner financing in 2006 was part of the sale for one in every 400 properties sold in Indian River County. That jumped to one in every 50 this year, and that number will grow as the inventory of Vero Beach houses declines during the next few years.

Harris said that while the market has been a tough road for sellers these past couple of years, there is a niche that owner financing will fill. “I think it’s potentially a good system,” he said. “ The investor is getting a decent return on his money and it’s safer than the stock market. I think it’s a fabulous strategy.”

But buying a home cheap, fixing it and selling it by holding the mortgage isn’t for everybody. Sellers need a reliable source of  homes for sale in Vero Beach and the equity to buy. Sellers should also make sure they have all the financial documents in order, such as proof of buyers’ income, tax returns and credit history, in case the seller wants to sell the mortgage one day to another investor.

First-time buyers are finally able to afford places of their own. Retirees are paying cash, taking their money out of the stock market and putting it back into real estate. Buyers who wait until they see prices rising on Vero Beach homes will likely pay more!

Even investors are slowly returning. They’re not flipping properties for quick profits anymore. Instead, they plan to rent them out, at least until the market recovers. Some Vero Beach Homes are bought from foreclosures or as “Short Sales” – where the bank takes less than mortgage balance.

Ed Gleason is due to close any day on a condo on the Vero Beach (32963) Barrier Island, but he’s not stopping there. He wants to buy several properties over the next year or so, with plans to rent them. “This is the first time in years that you can buy a rental and have it pay for itself,” said Gleason, 35, an architect who lives in Boca Raton. “I’m looking towards future appreciation and rental income..”

A typical home on Orchid Island now sells for less than $350,000, a price not seen here since spring 2004, according to the most recent data from the Florida Association of Realtors. Distressed properties fetch far less than that as desperate sellers and lenders slash prices to make quick sales.

Many existing condominium units, meanwhile, are going for under $200,000, nearly 30 percent less than two years ago. Age-restricted communities are seeing renewed interest in one-bedroom condos selling for less than $175,000, Vero Beach real estate agents say.

Properties in the $100,000 to $250,000 range appear to be the most popular among buyers, agents say. Despite the recent sales rise, Florida’s housing market is expected to remain soft into 2009 because of the slow economy and the large supply of homes for sale .

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