1. Archive


After three months of gains, fewer deals for foreclosed homes hurt.
Published May 10, 2011

So much for a housing recovery in Tampa Bay. After a record-setting March, sales of single-family homes fell in April - the heart of the spring buying season when sales typically climb.

The 12.1 percent decline in Hernando, Hillsborough, Pinellas and Pasco counties - and 2.8 percent from April a year ago - might be just a kink in a market in which sales increased in each of the first three months of the year.

Northing weighed on sales in April more than sales of foreclosed homes, which fell 25 percent in the four counties. Those transactions plummeted from 1,082 in March to 812 in April.

The number of bank-owned homes on the market also sank more than 20 percent, from 1,175 to 939, according to Multiple Listing Service data dissected for the St. Petersburg Times by Home Encounter.

Peter Murphy, president of the Tampa real estate firm, said the selling of fewer repossessed homes could help the market in the short term by increasing prices. Median sales prices of single family homes jumped 2.5 percent from March to April, though the figure is still down 9.6 percent from April 2010.

But Murphy cautioned that a glut of foreclosed homes will flood the market later this year.

"Where it will all go from there depends on how banks continue to handle their foreclosure inventory," he said.

The number of seized homes on the market peaked at 2,015 in December. But fewer listings for foreclosed homes doesn't mean fewer homeowners are entering the foreclosure process.

Real estate experts attribute the decrease in foreclosure sales to a moratorium imposed last fall by banks amid allegations that thousands of legal documents were signed improperly.

Many of those cases are being examined for title errors. Also contributing were the collapse of three of Florida's foreclosure law firms, which halted more than 100,000 cases statewide, and the two years it takes to clear foreclosure cases in Florida.

The collapse of the foreclosure mills gave many borrowers a temporary reprieve from foreclosure, meaning that thousands of cases could be dismissed unless lenders hire other attorneys.

Thomas McGrady, chief judge of the Pinellas-Pasco Circuit, said judges are reporting that banks are canceling sales on the courthouse steps, adding: "I'm still optimistic that the end is near."

Bank of America resumed selling foreclosed homes in December after the paperwork issue. Fewer of its homes are for sale because of the freeze, said spokeswoman Christina Beyer Toth.

"We have taken a deliberate and phased approach to restarting the foreclosure process," she said. "We are committed to ensure no property is taken to foreclosure until our customer is given an opportunity to be evaluated for a modification, short-sale or deed-in-lieu solution."

Two agents who deal with foreclosed properties have received fewer assignments from banks this year. Peter Chicouris of Equity Realty expects that it will be at least August before banks add homes to the market.

"The whole machine has stopped," he said. "The inventory is down tremendously. The whole state is this way."

Scott Samuels of Remax Metro in St. Petersburg said he went from 10 new assignments weekly at the end of 2010 to one or two a week now. He added that many homes received multiple offers in March as the supply tightened, adding: "This is significant."

Overall, Hernando County recorded a 39.6 drop in foreclosure sales last month; Hillsborough, 18.7 percent; Pasco, 23.6 percent; and Pinellas, 33.1 percent.

Realtors had hoped that March's surge would flow into April. The last month with higher combined sales of homes and condos than March was June 2006, when 4,417 properties sold.

The drop in foreclosure sales hurts the economy and housing market, said University of Central Florida economist Sean Snaith. He stressed that the housing market cannot fully recover until homes exit foreclosure.

Snaith had expected the foreclosure moratorium to affect sales at some point.

"It was tantamount to peeling a Band-Aid slowly off a wound," he said. "It's prolonging the recovery."

Mark Puente can be reached at or (727) 893-8459. Follow him at Twitter at

* * *

12.1% Decline in sales of single-family homes from March to April

25% Decline in sales of foreclosed homes in Tampa Bay

2.5% Increase in median sales prices of single family homes

* * *

Sales of existing single-family homes

County April sales March sales Percent change
Hern. 51 92 - 44.6
Pasco 528 622 -15.1
Hills. 1,009 1,144 - 11.8
Pinellas 807 866 - 6.8