Time to Buy? Don't Miss the Boat, or the Bottom

As the boat wound its way through the canals to the next foreclosed home, Joseph filled the time with a little education. He held a chart and showed the prospective buyers that homes sales in Cape Coral right now are rivaling the peak of the market in 2005, but, he added, they're selling at prices "50 percent" lower than they did four years ago.

It's no accident that homes got fancier as the tour continued. The Foreclosure Boat stopped at house listed for a cool $574,000 -- it had been listed for $800,000.

Chris Loepker said he liked the house's "vibe."

"I like the way it's built; I like the rooms; I like the square footage," he said, but he wasn't sure if he would bid on the home.

"I'd start with $350,000 and see what happens," he said.

When asked if he was playing tough, he replied, "You have to. Someone's going to get it, so it may as well be me."

Joy Norton, originally from Boston, now lives in Bonita Springs, not far from Cape Coral. She said the homes on this tour were a bit pricey for her pocket book, but she and her husband think it's time to buy.

"No waiting," Joy said without hesitating. "I've seen this go through back in '82 or something. We sat and we wanted to buy, but we didn't because we were afraid. I think you live and learn. This is the time to move."

Deep Discounts Available

It's not surprising that the fancier homes are on the water. But what drove the boom here and what's really dragged down prices are the more modest homes on dry land.

Joseph took "Nightline" from his Foreclosure Boat to his Foreclosure Bus -- which runs regular tours through Cape Coral each week -- to show us just how low prices can go

The bus stopped in front of tidy little 1,400-square-foot house built in 2001.

"The previous selling price on this house back in February of 2006 was $256,000," Joseph said.

It had just gone on the market for $54,900. And it sold in four days.

That's a staggering 80 percent discount from the peak of the market.

Joseph said some banks are simply determined to clear their books, so they are pricing repossessed homes very aggressively. And when they do, the houses sell quickly.

Back on the canals of Cape Coral there was one more home left on the tour.

One 3,000-square-foot house that had previously sold for $1.1 million is now listed at $664,000. But even with its prime lot it is going to be a hard sell: The roof is collapsing, there is mold under the eaves and there are a lot of decorative touches -- roman columns, wall paintings of Venice -- that will need a very special buyer.

Chris Loepker looked around and winced. The house was "really nice for somebody -- too much house for me," he said. "It's too much. I'm not just talking about the size. How do I say this -- it's not that I don't have class. It's just that it's too fancy."

Speculators Still Dominate Market

There's no question it is a buyer's market. It can't even begin to recover until the massive inventory of unsold and abandoned homes is absorbed, and optimistically that is going to take at least two years. But for all his optimism, Joseph has one nagging concern: The market that was destroyed by speculators is once again being dominated by them.

"They are two-thirds of the market, like they were before," he said. "I wish I could tell you it was another story, but it's not. This is the story. ... They are looking at this as an opportunity.

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