Once again, it’s worth watching the pace of mortgage foreclosure filings in South Florida. After several years of peace and quiet in the foreclosure market it appears that mortgage loan defaults are on the rise again. During the month of April, there was an increase and new foreclosure filings in Miami, Fort Lauderdale, and Palm Beach. You need to remember that during the pandemic, foreclosures were halted for borrowers who were behind on their payments. Now it looks like lenders are ready to take action against delinquent borrowers. You don’t have to worry too much because the foreclosure process in the state of Florida takes forever and more importantly, people know how to game the system. The foreclosures that are being filed today would take several years to reach the market, so they don’t pose a threat at this time. A contributing factor to affordability issues could be the ongoing insurance crisis, as it only seems to be getting worse each year. As a reference for the chart above, here is a look at the annual totals, monthly average and year over year change in that average number of filings:
The good news for lenders is that there is plenty of equity in the South Florida real estate market. During the month of March, single-family home prices reached $860,537 and condo prices reached 539,065. There is no doubt that easy money has created a massive bubble, but this may take awhile to unwind.
Residential inventory across South Florida remains low. In March there were 10,163 houses and 14,776 condos listed for sale on the market. Until you see a large increase in available inventory, you probably won’t see a sharp decline in prices.
Transaction volume climbed during the month of March when there were 4,297 houses and 3,829 condo properties sold. This was a significant bounce from the month of February and January as well. We shall see if that’s the end of activity for the season and this cycle as you will notice from our next chart that mortgage rates will continue to remain elevated. You can keep an eye on mortgage rates right here.
This real estate market outlook covers real estate activity in Miami-Dade, Broward and Palm Beach County, Florida. Here are just a few of the cities in each of these three markets:
- Miami-Dade – Aventura, Coral Gables, Miami Beach, Hialeah, Sunny Isles Beach, North Miami, Homestead, Doral, Miami Lakes, Downtown Miami, Brickell and Key Biscayne.
- Broward – Fort Lauderdale, Pompano Beach, Deerfield Beach, Hollywood, Hallandale, Weston, Parkland, Wilton Manors, Oakland Park, Plantation, Cooper City, Davie, Coral Springs, Sea Ranch Lakes, Lauderdale by the Sea and Lighthouse Point.
- Palm Beach – Delray Beach, Highland Beach, Jupiter, Palm Beach Island, Boynton Beach, Boca Raton, Highland Beach, Palm Beach Gardens, West Palm Beach, Wellington and Lake Worth.