Foreclosure Silver Lining: Cheaper Homes

Home buyers are getting deals on their dream homes thanks to foreclosures.

Oct. 30, 2008 — -- Home shoppers in hard-hit foreclosure states like Florida are discovering they can get more for their money because prices are drastically lower.

This is a sort of silver lining to the housing crisis gripping many parts of the nation, allowing some purchasers to get great deals.

It has let Florida resident and small-business owner Cindy Mediate realize her dream of owning a big house where she and her husband, Marc Mediate, can raise a family.

Cindy Mediate, who runs a startup clothing boutique, said she couldn't afford a home like the one that she recently looked at while house hunting. The residence previously was listed at $500,000, but now it's much lower.

"I am loving it a lot. It's beautiful," Cindy Mediate said while looking at the home. "It's everything we wanted."

The Mediates purchased the home for $360,000. Now they have a pool, yard and the life they dreamed of far sooner than they had previously imagined.

"It's something that I would have aspired to in the future, but the future is now," Cindy Mediate said.

"We're inundated. We're in uncharted waters. I haven't seen this in 19 years. There's some great deals out there," said Florida real estate agent Kelly Price.

Price said houses that were in the $300,000 and $400,000 range now are selling for much less. She cited one home that was up for $1.2 million whose price had dropped to $799,000 as an example of just how much the market had shifted.

Last month Florida surpassed California and Arizona to claim the second highest rate of foreclosure filings in the nation, according to California-based market researcher RealtyTrac.

Foreclosures jumped 9 percent from August to September and compared with the same time period in 2007, foreclosures have soared 44 percent.

While the tight market may be hurting sellers, it's helping buyers get homes that would otherwise have been unaffordable.

"Three years ago, I would show people and they would have three homes to choose from. Now they have 15," Price said.