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Demand for Homes Great for Orlando Foreclosure Investing

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By : John Cutts    99 or more times read
Record numbers of pending sales are great for Orlando foreclosure investing, as they show the level of homebuyer demand and the level of sales prospects for investment homes.

In April, the number of pending home sales in metro Orlando shot up to a staggering 10,832 homes under contract, a record high for the market and a sharp jump of 86 percent from April last year. The number of newly-filed purchase contracts also spiked to 5,221, an increase of 53 percent year-over-year.

The demand for Orlando homes has been spiking because buyers and investors want to buy before house prices shoot up to high levels again. Currently, price levels have increased, but they are still below the price levels in 2009.

The median sales price for units from lists of foreclosed homes for sale increased in April by 1.6 percent to $72,900 while the price median for short sales rose by 1.7 percent to $115,000. With these increases in distressed property prices, the median price for all types of homes increased by 4.5 percent to $115,000 in April.

However, despite the increases, buyers still consider April price levels low because the $115,00 median was still lower than the $130,000 median posted in April last year.

Another factor affirming Orlando foreclosure investing was the still substantial number of foreclosure postings in April despite the declining trend in the metro area. Greater Orlando has slid down from the top-ten foreclosure ranking, but the 6,480 homes that entered the foreclosure process in April was still a relatively high number.

These distressed homes in April, located in the counties of Orange, Osceola, Lake and Seminole which comprise metro Orlando, marked a drop of about 24 percent from the 8,586 filings counted in March and a decrease of almost 25 percent from the 8,606 postings counted in April last year.

One factor largely pushing defaults and foreclosures in metro Orlando is negative equity. With 55 percent of all area mortgages or a staggering total of 285,004 mortgages much higher in amount than the value of the properties mortgaged, Greater Orlando was ranked third nationwide by a real estate firm in number of underwater mortgages. Among Florida markets, Orlando topped the ranking in negative equity in April.

Homes in Central Florida have lost half their value over the past three years, as these properties were bought at inflated prices and were refinanced in the middle of 2007 when price levels were at their highest.

The pace of foreclosure in Florida has slowed down substantially, but the state still ranked third among states in foreclosure activity in April. The total number of foreclosure filings in April was 48,384, the second highest number posted by a state during the month, second only to the total posted by California.

Of the more than 48,000 filings, a total of 9,259 units or 19 percent of filings have been bought back by lenders. With these numbers, people looking for cheap homes in Florida and those involved in Orlando foreclosure investing still have good opportunities for buying and reselling profitably.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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