Short Sales Eclipse Foreclosures in Palm Beach County
Short Sales Eclipse Foreclosures in Palm Beach County
The bulk of foreclosures that dominated the Palm Beach housing market in the wake of the housing crisis have been sold, and now short sales are on the rise as lending institutions have revised their standards for short sales thanks to new federal legislation. The number of short sales in Palm Beach County increased by 33% in comparison with a year ago, according to the latest study released by Realty Trac Inc., with non-foreclosure short sales increasing by approximately 60% in Broward County during the same time period.
In the past, lenders didn't agree to short sales until home owners already filed for foreclosure; however, they're quickly becoming much more commonplace nationwide. Short sales offer the advantage of being much more efficient than foreclosures, and although they can still take up to six months in some cases, the new, streamlined process allows short sales to complete without lengthy delays.
"In the past, it was very frustrating working with the banks because they often would drag their feet, lose documents and constantly ask for updated financials," said Boca Raton attorney Jerron Kelley in an interview with the Palm Beach Post. "Now, what used to take six months to a year can take anywhere from three to six months from start to finish."
The fact that foreclosures are declining is one of the positive market trends leading to increased stability in the Palm Beach real estate market. Prices are trending upward, and this is due, in part, to the decrease in foreclosures that caused a drop in median home values in the direct aftermath of the housing crisis. According to the most recent statistics, Palm Beach and Broward counties experienced a decrease in third quarter sales of homes in the foreclosure process. Foreclosures in South Florida sold for an average price of $139,814.
Competition for the remaining short sales in the Palm Beach market is heating up. As prices rise throughout all sectors of the real estate market, investors and first-time buyers are scrambling to place bids on the remaining distressed properties for sale, and in some cases, bidding wars are causing prices to rise beyond the current market value. A shadow inventory of foreclosed properties may affect the median home value in South Florida in the upcoming year; however, real estate experts believe that prices will continue a steady path toward recovery. The improving job market and local economy are closely tied to the improving real estate market, and the increase in South Florida tourism will create an incentive for local officials to work toward improving neighborhood amenities that will increase the home values of existing real estate in Palm Beach.
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