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Prices of bank-owned homes in Tampa Bay soar as foreclosures plunge

Foreclosures have dropped significantly in the Tampa Bay area over the last year, but this has caused bank-owned homes to spike in price as inventories shrink. 
BRYAN THOMAS | Times
Published Sep. 28, 2016

Though still above the national level, Tampa Bay's foreclosure rate continues to drop while good deals on foreclosed homes are getting scarcer by the month.

In July, 2.16 percent of bay area homes with mortgages were in some stage of foreclosure compared to 3.54 percent a year earlier, Corelogic reported Wednesday. With lenders repossessing fewer homes, prices of bank-owned properties are soaring.

In Pinellas County, for example, there were 61 percent fewer sales of foreclosures in August than in the same month a year ago. That sent the median price of a foreclosure up nearly 25 percent, to $137,250.

In Hillsborough and Hernando, year-over-year prices in August rose 21 percent, to $151,250 and $93,197 respectively.

And in Pasco, they jumped an unprecedented 35 percent, leaping from $89,500 in August last year to $121,000 this year.

One big market for foreclosed homes — house flippers — is changing as prices climb.

"People used be able to pick them up so cheap so it was more attainable for more people to do that,'' said Bruce Harris, a broker associate with Scott Samuels Realty in St. Petersburg. "It's shortened the pool of flippers because not everybody has the money available.''

Now, flippers need either a lot of cash or a private-lending source, Harris said.

More on house flipping: Tampa Bay now ranks third in the nation in house flipping

For buyers looking for a foreclosed home to live in, the competition with flippers and investors can be fierce. Foreclosures often move fast, especially in desirable areas.

In Palm Harbor's Indian Trails, a four-bedroom, 2,800-square-foot foreclosure listed at $331,500 is under contract after just six days on the market. In Tampa's Carrollwood area, a three-bedroom, two-bath home with greenbelt view listed at $178,000 drew a buyer in seven days.

Previous coverage: Tampa Bay home prices jumped 20 percent in August, more than any other metro area in Florida

Tampa Bay's supply of foreclosures should continue to shrink because fewer homeowners are delinquent on their mortgages. In August, 4.8 percent were more than 90 days late on their payments compared to 7.13 percent a year earlier.

Nationally, 2.82 percent of all U.S. homes with mortgages were in some stage of foreclosure in July while in Florida the rate stood at 4.2 percent.

Contact Susan Taylor Martin at smartin@tampabay.com or (727) 893-8642. Follow @susanskate

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