Today's Local Real Estate News: "I’m really having to explore other options."

The Sun-Sentinel reports on the surge of late mortgage payments (see this previous post for more information on the expected flood of foreclosures):

“U.S. banks and thrifts suffered the biggest increase in late loan payments in 17 years as more homeowners fell behind on mortgages, the Federal Deposit Insurance Corp. said.”

“In the period ending June 30, loans more than 90 days past due rose 10.6 percent to $66.9 billion, the largest quarterly rise since 1990, the FDIC said in its Quarterly Banking Profile released Wednesday.”

“In South Florida, late monthly mortgage payments have been increasing since last year. Experts expect these late payments will result in a foreclosure surge sometime next year.”

“The number of people behind on their mortgage payments in July, the latest data available, almost tripled in Broward County from a year ago, from 517 to 1,430, according to Plantation-based Realestat.com. In Palm Beach County, the number more than tripled from 298 to 1,063.”

The Palm Beach Post reports on some good news associated with the housing downturn:

“Palm Beach County's property appraiser mailed more than 620,000 property tax notices on Tuesday, and the preliminary bills show two things homeowners haven't seen in years: falling values and falling tax bills.”

“Of the 620,647 residential and commercial properties in Palm Beach County, 59 percent are worth less this year than last, said John Thomas, assistant director of residential appraisal services at the property appraiser's office.”

“Palm Beach County home prices have been in a slump since late 2005, when the speculative frenzy of real estate sales and double-digit price increases subsided.”

“Meanwhile, the number of homes for sale has continued to grow. Nearly 25,000 homes are for sale in Palm Beach County, according to Illustrated Properties Real Estate. At this time last year, 22,000 homes were on the market, according to Illustrated's Web site.”

“For longtime homeowners with homestead exemptions, the drop in market value will have no effect on their tax bills. That's because the Save Our Homes amendment to the state constitution allows homes' taxable values to rise 3 percent a year even if the market value falls, as long as the taxable value remains less than the market value.”

The Miami Herald reports on recent job losses in the mortgage industry:

“At the North Carolina offices of mortgage lender HomeBanc Corp., Archie Clark is the only employee left. But in a few days, he'll be gone, too. When Clark finishes helping movers from the company's Atlanta headquarters collect computers and other property, he'll join the more than 25,000 workers nationwide who have lost jobs in the financial services industry since the beginning of the month - with more than half coming since last Friday.”

“With few exceptions, the cuts are the direct result of woes in the nation's housing market.”

“More layoffs are announced daily. On Wednesday, Scottsdale, Ariz.-based 1st National Bank Holding Co. closed its wholesale mortgage unit and cut 541 jobs, while Accredited Home Lenders Holding Co. added 1,600 positions to the heap. The night before, banking giant HSBC said it would close a main financing office and cut 600 jobs.”

“Since the start of the year, more than 37,000 workers have lost their jobs at mortgage lending institutions, according to recent company layoff announcements and data complied by global outplacement firm Challenger, Gray & Christmas Inc. Meanwhile, construction companies have announced nearly 20,000 job cuts this year, while the National Association of Realtors expects membership rolls to decline this year for the first time in a decade.”

“It's an employment collapse that threatens to rival the massive layoffs in the airline industry that followed the Sept. 11, 2001, terrorist attacks, when some 100,000 employees lost their jobs.”

Appraisers are not doing much better according to an article by the Daily Business Review:

“Fewer sales and refinancings in the plummeting home resale market along with pressure from mortgage brokers are taking a toll on residential appraisers.”

“With the sales downturn, South Florida appraisers must expand their search criteria for comparables sales and spend more time explaining their conclusions. Some are taking on other types of appraisal work to stay afloat.”

“‘There are a lot of appraisers sucking wind,’ said Florida Real Estate Appraisal Board chairman Frank Gregoire.”

“Some appraisers around the state who once worked 10 to 12 assignments a week are now down to one or two, he said. South Florida appraisers are not immune.”

“‘I’m really having to explore other options for something to do after 26 years,’ said Doreen Campbell, owner of Campbell & Associates Appraisers in Davie.”

Mortgage-industry employees and appraisers are not the only ones looking for new options. According to the Florida Association of Realtors®, their memberships are dropping. The Union-Tribune reports:

"Plummeting stock prices. Mortgage lenders filing for bankruptcy or shutting down. Layoffs at homebuilders and banks. Soaring foreclosures and loan defaults."

"Damage from the nation's slumping housing market is evident throughout the economy and permeates financial markets. Add real estate agents to the growing list of victims, although they know few tears will be shed for them."

"Nancy Riley, president of the Florida Association of Realtors, said membership more than doubled since 2001 and stood at 169,434 last year. The group had budgeted for a 25 percent drop, but expects roughly the same total by year-end."

"'Most people getting out got in just to make a quick buck,' Riley said, blaming tax issues, insurance costs and the media for the perception that Florida's real estate market continues to falter."

"'It's not doom and gloom,' Riley says, insisting the state is gearing up for another population boom. "

The Miami Herald reports on a troubled local developer:

“WCI Communities, the Florida home builder that reached an agreement with Carl Icahn to overhaul its board, reported a second-quarter net loss after weak housing demand forced it to write down some properties.”

“The net loss totaled $33.2 million, or 79 cents a share, compared with net income of $22.7 million, or 52 cents, a year earlier, Bonita Springs, Fla.-based WCI said Wednesday in a statement. Revenue fell 54 percent to $241.8 million.”

The Sun-Sentinel published more news of troubled companies that have business in South Florida:

“Toll Brothers Inc., the biggest U.S. luxury home builder, said Wednesday its third-quarter profit tumbled, hurt by higher-than-expected cancellations as the housing downturn and credit quality concerns continue.”

“Robert Toll, chairman and chief executive, said cancellation rates for the quarter were greater than at any point in the 21 years the company has been traded publicly.”

“Earnings for the three-month period that ended July 31 dropped to $26.5 million, or 16 cents per share, from $174.6 million, or $1.07 per share, during the period a year ago.”

“Toll Brothers has several projects in Palm Beach County, including Trieste in Boca Raton and the Jupiter Country Club.”

Jeff Witkin got his letter to the editor published in the Sun-Sentinel:

“The recent flurry of letters from opponents of property tax reform is appalling. “

“We have an unusual opportunity to make a statement that we are desperate for tax reform! (And no, the cuts will not affect our education or services — poorly managed funds do way more than these tax cuts ever will).”

“Stop seeing the world with blinders. If you're complaining, you've probably made an unexpected fortune on your house. Pay your share of taxes and stop whining. Think of the benefit to the community, and we will all see a benefit.”

But, don’t worry; one Sun-Sentinel columnist assures us the housing will recover shortly:

“South Florida is no stranger to real estate booms and busts.”

“In the 1920s, even swamp land was going for premium prices. A couple of disastrous hurricanes literally put a damper on the land speculation and housing boom. Then the stock market crash of 1929 and the ensuing Great Depression sent the region even deeper into the economic muck.”

“South Florida eventually recovered, but not until after World War II, when a revitalized national economy and the widespread use of air conditioning resulted in massive migration to the region.”

“Florida has been particularly hard hit, with the home sales rate the lowest in the country and foreclosures among the highest.”

“In economics, as in physics, actions are followed by reactions. The reactions following boom times are painful, but in a free-market economy, they are necessary to wring out the excesses and bring things back to a semblance of equilibrium.”

“Rest assured, the South Florida real estate market eventually will revive itself, although it will take time. There's only so much land available with South Florida's climate, and for millions of people, chancing a hurricane still beats shoveling snow, scraping windshields, and driving on icy roads.”