Friday, October 17, 2008

More foreclosure woes

It is reported that the president of The Venetia's association, angrily told a crowd of South Florida condo dwellers at a meeting this week that 134 units were not paying maintenance fees in the 382-unit building. Of those, at least 35 are in foreclosure, and the owners are not paying and the banks are dragging their feet on foreclosures.the hands of lenders who aren't playing fair.

The unpaid accounts have resulted in higher association fees for everyone and crippling special assessments to cover large one-time expenses like roof repairs. Less than a year ago, The Venetia had to pass an $8,000 special assessment on homeowners because, at the time, roughly a quarter of them were delinquent.

South Florida's foreclosure crisis is dealing its toughest blow to the hundreds of thousands of homeowners who live in condos. High foreclosure rates have made it difficult for many associations to make their budgets and provide services like cable, lawn care and pool maintenance.

Stay on top of your accounts receivable!

Thursday, October 16, 2008

A downward spiral?

The Miami Herald reports that in South Florida, 40% of homes purchased in the last 5 years are 'worth" less than is owed on them and 76%(!) of the homes sold since 2006 are. This is only the tip of th eiceberg, as the more homes that are foreclosed on by the "lenders" the more home prices will fall, as they are sold for anywhere from 25%-50% less than other homes in that neighborhood. That leads to less "comps" and less valuation, causing more people to default as they will end up being bailed out by the government, &tc., &tc.

Where will it end? Who knows. My advice continues to be for communioty associations to push hard for prompt, aggressive collections and foreclosures of their own as first mortgage foreclosures are now taking over 18 months in many cases....