HOUSINGNEWS REPORT
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owner of Marc Joseph Realty, has similar concerns about the institutional investors who purchased single family rentals by the thousands in his market over the last seven years since the housing market hit bottom in 2007. “Those hedge funds, they haven’t dumped them yet,” he said, noting that he anticipates those big investors will sell off their inventory at some point before the market returns to its pre- recession high of $317,000 as tracked by the local MLS. “They’re not going to go past 317. Why? They’ve already tripled their money.” Joseph said other buyers who bought during the downturn are starting to cash out, a trend that concerns him. “I’m watching someone triple their money … when I hear tripling their money and cashing out, at some point you run out of
chairs,” said Joseph, who gave an example of a recent client who had purchased two homes side by side at a bargain price during the downturn but was now selling. “The guy is 70 years old and just wants to take money off the table.” Joseph is concerned that another housing market correction could be coming given the rapidly rising home prices and renewed frenzy from out-of-town investors buying in Cape Coral, but he doesn’t anticipate it correcting as severely as it did during the Great Recession. “Honestly I don’t think I’m ever going to see that again. Now because things are so transparent, I don’t think we’ll see that amount of people displaced from their homes again,” said Joseph, who at one point during the last downturn was giving foreclosure bus and boat tours in Cape Coral, one of the epicenters of the foreclosure crisis. “(But) am I going to go
out and buy a house right now after being in business 25 years? Hell, I’m scared.”
Starving Foreclosure Market New risks emerging in the Cape Coral market such as rampant new construction, looser lending and lease options are what concern Joseph more than legacy distress. He said the backlog of bad loans from the last housing boom have mostly been cleared out in his market, dropping from as high as 22,000 foreclosure cases in the Lee County court system down to 827 at the beginning of 2017. “That’s a lot of inventory to smoke through,” he said. “If you’re still trying to sell foreclosures now, you’re probably going to starve. It’s changed that much.” Statewide in Florida a total of 131,889 properties had foreclosure filings in 2016, down 37 percent from 2015 to the lowest
Florida Foreclosure Starts & Completions Down Foreclosure Starts Scheduled Foreclosure Auctions
If you’re still trying to sell foreclosures now, you’re probably going to starve. It’s changed that much.”
Bank Repossessions (REO)
400,000
350,000
300,000
250,000
Marc Joseph Broker/owner, Marc Joseph Realty, Cape Coral, Florida
200,000
150,000
100,000
50,000
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ATTOM Data Solutions • P7
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