Struggling economy hits high-end housing market
While cities all around the country have been seriously impacted the housing bubble burst and economic crisis in recent years, places like Miami and Fort Lauderdale, Florida, were hit especially hard. Now, new evidence suggests that the latest demographic facing foreclosure in large numbers may be among the wealthiest in the nation. And apparently such findings suggest both positive and negative changes in the housing market.
It seems that the country’s top earning homeowners could not stop foreclosure from ignoring them completely. Even though national foreclosure rates are on the decline, the highest end of the housing market is seeing a considerable increase in foreclosures, up more than 60 percent in one year alone. It is also estimated that the state of Florida is among those worst hit by the recent flux, since 47 of the 200 total ultra-high-end foreclosures occurred in the Miami/Ft. Lauderdale region.
Experts note that many of these foreclosures were likely in the works for quite a while and high-earning homeowners probably held off on filing for as long as they could. That is not to say, however, that the news is all bad. Multimillion-dollar properties in foreclosure attract buyers and offer a unique deal. Similarly, luxury home sales are solid right now. As a result, lenders may be more inclined to place these properties on the market. Furthermore, the increase in high-end foreclosures may be an indication that lenders are in a better financial situation themselves, since they are beginning to move forward with sustaining such losses.
Other cities hit by multimillion dollar foreclosures include Orlando, New York City and Atlanta.
Source: CBS News, “Foreclosure rate on luxury homes explodes,” Ilyce Glink, Dec. 5, 2013