Low Home Prices Blamed on Foreclosed Homes Foreclosure
July 25th, 2009 by 
Joseph Smith
Last month, home sales in Tampa Bay, Florida jumped by 21 percent, but prices were still down because of the increase in the number of foreclosed homes foreclosure on the market.
According to industry experts, home sales in the area rose to 21 percent compared to the same month last year. But they also pointed out that the increase is brought about by the low home prices which they blamed to the unfair dumping of foreclosed homes foreclosure on the market by banks.
Data showed that home sales improved from last year’s 2,346 to 2,848 for June. Last month’s figures were the 10th consecutive month that home sales rose in the area. The highest June house sales was reported in 2005 for a total of 5,230.
When it comes to home prices, they remained steady since bottoming at $121,000 earlier this year. However, property prices are still down by 22 percent compared to last year. The median home price in June 2008 was $139,400.
Industry experts said that home prices in the area would have improved or gone higher if banks did not dump cheap foreclosed homes foreclosure on the market for almost half the price from their original value.
Data showed that sales of pre-foreclosure and foreclosure properties accounted for 37 percent of the total home sales last month.
Industry experts have blamed banks for prolonging the mortgage and housing crisis by overloading the market with cheap foreclosure properties. They said that the Obama Administration’s bailout program had only encouraged banking institutions to sell foreclosed houses at prices they want because they know that the federal government is covering their financial losses.
Experts also said that lenders are now the most influential sector in the housing market. They noted that instead of learning some lessons from the residential real estate boom and collapse and acting responsibly, lenders and banks are now selling foreclosure properties at prices below the market value that the sector is single-handedly working on the drop of Tampa Bay property values.
But industry experts conceded that these cheap foreclosed homes foreclosures are driving home sales in the area, citing the $8,000 tax credit given to first-time homebuyers as a big contributor to the sales turnaround.
