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Cape Coral Foreclosures Second Only to Las Vegas Filings

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By : John Cutts    99 or more times read
Record numbers of Cape Coral foreclosures in 2009 put the city second only to Las Vegas in a ranking of metro areas based on pace of foreclosures during the year.

Based on a study conducted by a California-based real estate information provider, the Cape Coral metropolitan area in Florida had 11.9 percent of its residential units hit with foreclosure postings in 2009 or a total of 42,862 housing units.

In Florida, seven other cities reached foreclosure rate levels that topped foreclosure charts in 2009, including the Orlando area, which posted an 8.2 foreclosure rate, and the Miami area, which had a 7.2-percent foreclosure rate.

Las Vegas, the top placer, had over 12 percent of its residential units in foreclosure more than 5 times the nationwide foreclosure rate.

Recently, U.S. Senator George LeMieux of Florida visited Cape Coral to see for himself what the foreclosure crisis has done to several neighborhoods in the city. Frank Cassidy, code enforcement director of Cape Coral, showed the senator how city officials are trying their best to prevent community decay so that people buying foreclosed homes would not be discouraged in moving to the city or investing in the area.

According to Cassidy, there are currently about 24,000 Cape Coral foreclosures that the market needs to absorb in order to help the housing sector recover. Based on sales data, the average home price in Cape Coral has fallen by almost two-thirds to only $97,000 from the January 2007 peak price of around $255,000.

With big residential projects failing in Cape Coral and in other parts of Lee County, more foreclosures are expected in the area this year. Recently, the three huge commercial and residential projects of Fort Myers-based property developer Grosse Pointe Development were put into foreclosure. Grosse Pointe owed $236.4 million on its Tarpon Point retail, hotel and residential community in Cape Coral; $19.6 million on its Bell Tower residential community in Fort Myers; and $83.6 million on its Bonita Springs project.

With a total loan value of $339.6 million, the Grosse Point projects are costlier by over 300 percent than the previous foreclosure record posted by the failed Paradise Preserve in Fort Myers.

In 2009, Florida foreclosures surpassed the half-million level, putting the state third among all states based on foreclosure rate. Cape Coral foreclosures, with an almost 12-percent foreclosure rate, certainly contributed to the high ranking of Florida.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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