Buying Foreclosures in Manatee, Florida Is Profitable
October 9th, 2009 by 
jfoxx
Buying foreclosures in Manatee, Florida is profitable for investors who can wait for a price recovery and for first time home buyers looking for low-priced properties. Based on property sales and court records in Manatee, home prices continue to fall in the area.
According to real estate analysts, if the sales price for a house is lower than the cost to duplicate the house, then the house has value. Investors who do not need to resell immediately and who can wait for a price recovery are the ones in the position to make significant profits.
Based on public records, 2 out of 3 homeowners who lost their homes to foreclosure in September were underwater – the values of their homes were much lower than the amounts of their loans. The average negative equity was $72,098.
Among all underwater borrowers who received foreclosure notices in September, the average home loan amount was $282,268 while the average home value was only $210,170.
For higher-cost properties, the gap between loan amount and home value is even bigger. A home on Lakewood Ranch purchased with an almost $2.05 million loan is now valued at only $1.45 million while an apartment complex with a loan balance of almost $18.6 million is now worth only $12.1 million.
With homeowners in Manatee owing much more than the value of their homes, many of them could not qualify for refinancing programs so they cannot do anything if their properties are repossessed by their lenders and sold to investors buying foreclosures.
According to Florida foreclosure lawyer Shari Olefson, most homes in the Manatee area are underwater by over 25 percent, so they are outright disqualified even if the Obama administration extended their refinancing loan-value limit to 125 percent.
Manatee homeowners could also not qualify for the Home Affordable Modification Program because of the high level of insurance costs and property taxes in Florida. Their monthly home loan payments could not be lowered to below 38 percent of their monthly income.
In September, a total of 534 foreclosure lawsuits were filed in Manatee County, a higher number compared to filings in August. Over the first 9 months of this year, banks and mortgage servicers filed nearly 4,900 foreclosure lawsuits, much higher by 16.5 percent than filings during the same three quarters last year.
Over 75 percent of foreclosure filings in September involved homesteaded properties, indicating more opportunities for investors buying foreclosures.
