Why so many foreclosures in St Augustine area? (Jacksonville, St. Augustine: real estate market, rentals)

[goshenretire]

On zillow for St Augustine the following is reported:
Foreclosures 55
Foreclosed 154
Pre-Foreclosures 235

Why so many foreclosures in this area?

[Peter the Brit]

backlog taken time to go through the Courts

[ssclulow]

During the height of the real estate boom, St. Johns County was one the top 10 fastest growing counties in the U.S. Prices shot up, builders were working triple time fast to meet the demand and banks were foolishly lending money to buyers who should have never qualified. What you are seeing is the aftermath of the boom gone bust. The recession hit hard in FL where construction and tourism employ a large percentage of people. Home prices declined and many homeowners now owe way more on their homes than the homes are now worth on the market. Those that did not walk away and default on their loans at the beginning of the recession have remained in their homes trying to work out a deal with the banks. The banks are slowly either giving loan modifications or completing foreclosure proceedings in the courts. I know several families who received their first bank pre-foreclosure notification 2 years ago who are just now receiving yes or no answers to their loan modification applications. That's a longtime to be unsure how long you will have a roof over your head. In the meantime, most occupants are not spending money on repairs. Many of the homes that the bank takes back are just getting superficial, cosmetic go overs before being put on the market. Home-flippers are making a good income buying them, putting in some sweat equity, a few more repairs & upgrades then reselling.

[thatguydownsouth]

^ Couldnt have said it better myself!

[canajo]

I am glad to see this thread. As someone who used to sell REO foreclosures when I worked for FDIC and MGIC (who insure the lender in case of default) I too am nervous about the number of pre-foreclosures and foreclosures showing up on Zillow in many of the Jacksonville areas. I am relocating here in July and had planned on buying but now I think I will rent for a few years. One thing that makes me nervous is that the new builds in the planned communities seem to be selling like hotcakes but at the same time foreclosures are still coming down the pipeline. What are your thoughts on that? I wonder if the bottom has been reached yet?

[ssclulow]

I personally would not purchase a house to homestead in Duval County (Jacksonville). IMO, mass exodus of young families will continue,which is not a good thing in a real estate market that is far from recovery. Investors who want to purchase to put on the rental market will continue to do well as foreclosures continue there. I predict that the popular Northern St Johns County planned communities such as Nocotee will remain hot markets throughout their years until build-out. The overwhelming majority of those homes will be homesteaded. Communities with large numbers of foreclosures will have a large percentage non-homesteaded properties (rentals). The demand for rentals in St. Johns County far exceeds the supply because of the rapid influx of new residents seeking to homestead, the continued builder interest in starting new developments and the slowdown of foreclosures (especially in comparison to Duval County). Southern St. Johns County (St. Augustine) is seeing a lot of new developer activity. SR 207 area has seen a handful of new communities beginning infrastructure. These appear to be mass production type communities where national builders swoop in, develop and build-out within 2 years. Young families seem to be drawn into these because they are new, have a superficial furnishings "wow!" factor and give opportunity to live in community with other 30 somethings' families. Interest rates are low so builders can get them into a larger sq. ft house. The surprise comes in 3 - 4 years when the building practices don't hold up over time and repairs must be made out of pocket. I've heard some very troubling reports about how the national builders deflect liability onto their subcontractors to avoid the corporation being held accountable for questionable building practices.

[Fl1150]

Originally Posted by ssclulow

I personally would not purchase a house to homestead in Duval County (Jacksonville). IMO, mass exodus of young families will continue,which is not a good thing in a real estate market that is far from recovery. Investors who want to purchase to put on the rental market will continue to do well as foreclosures continue there. I predict that the popular Northern St Johns County planned communities such as Nocotee will remain hot markets throughout their years until build-out. The overwhelming majority of those homes will be homesteaded. Communities with large numbers of foreclosures will have a large percentage non-homesteaded properties (rentals). The demand for rentals in St. Johns County far exceeds the supply because of the rapid influx of new residents seeking to homestead, the continued builder interest in starting new developments and the slowdown of foreclosures (especially in comparison to Duval County). Southern St. Johns County (St. Augustine) is seeing a lot of new developer activity. SR 207 area has seen a handful of new communities beginning infrastructure. These appear to be mass production type communities where national builders swoop in, develop and build-out within 2 years. Young families seem to be drawn into these because they are new, have a superficial furnishings "wow!" factor and give opportunity to live in community with other 30 somethings' families. Interest rates are low so builders can get them into a larger sq. ft house. The surprise comes in 3 - 4 years when the building practices don't hold up over time and repairs must be made out of pocket. I've heard some very troubling reports about how the national builders deflect liability onto their subcontractors to avoid the corporation being held accountable for questionable building practices.

Duval County has new communities to and their is no mass exodus of families I mean If your living in a good school district there why move to St. Johns County ?

[ssclulow]

Just to clarify...Duval County is 1 school district under one school board governance. That school board can change the attendance boundaries of neighborhood schools, reassign principals & teachers, and adjust budgets given to individual schools. Charter Schools have more autonomy and are growing at a rate of 30% per year in Duval County which is the 3rd fastest growing county in US for number of students attending charter schools. Approx. 10,000 of the 125,000 students in Duval Public Schools attend charter schools. In addition to students attending public schools, approx 25,000 students attend private schools.

[Aim4Florida]

Honestly, as a person who has been in the real state business here for 10 years, I can tell you they are just everywhere, still, in Florida. Getting better, but no one area really is singled out.

Just don't rely on Zillow info, they give me a the creeps with their inaccuracy. ;-)

I'd be glad to send you real stats, just let me know what kind of sold info you'd like. There are some good deals to be had around here, for sure. St. Augustine is an awesome town!

Amy Rose
ARoseinJax Twitter

[coltoncity]

I Loved St Augustine, Its one place I would live at the drop of a hat if I could get my family to move there to the east coast.