The surge in new filings was called “dramatic” (I would have called it “expected”) by Palm Beach County Clerk and Comptroller Sharon Bock, who released the numbers Friday. But it was a bump that analysts (and I) predicted would follow the $25 billion settlement between lenders and the nation’s attorneys general.
As the time to go from initial foreclosure filing to the home actually being put up for sale by the bank is quite long in Palm Beach County and bank-owned homes sell at a substantial discount to regular home sales, this huge increase in foreclosure filings does not bode well for the near to mid term trend for home values here in Palm Beach County.
In the past, there were an insignificant number of distressed sales, so appraisers could leave them out of the appraised value equation. In todays environment, the large number of foreclosures and short sales forces the hand of appraisers, virtually ensuring that the appraisal required on most home sales will include foreclosure comparables, almost guaranteeing a continued softening of average sales prices.
Sorry to be the bearer of more bad news, but I publish my blogs in an effort to sort through the conflicting, and sometimes intentionally misleading, stories being disseminated today.
If you’d like to discuss how the current and near term trend impact your selling or buying plans, please call me directly at 561.602.1258
And, as always, thanks for reading…Steve Jackson
