Having spent six weeks looking at foreclosures in the United States, I have decided to wait a while before investing heavily. This crisis has not yet run it’s course and I feel there are more casualties to come.
A recent report released by RealtyTrac, an American foreclosure company shows some horrifying statistics- 2.2 million foreclosure filings in 2007 – a 75 percent increase over 2006.
I did buy a couple of properties in Florida – but these were new builds offered by developers rather than foreclosed properties. This is a safe place to buy right now and even if prices fall another few percentage points, the likely increase in the value of the dollar (I am spending Euros) over the next six months will wipe that out.
As for repossessions, much of the property is in a poor state of repair, and the luxury of buying new is attractive. There will be more developers joining the ranks of those who have elected to cut their losses very shortly and this is where to find the best deals at the moment. But, you need to be there, on the ground unless you have a trustworthy representative to act on your behalf.
But for my money, right now – play a waiting game as far as repossessions go – a further price drop is likely over the next 3 – 4 months.
If you are looking for foreclosed property, Mark has written a good guide to where to find government owned foreclosures here.
This is RealtyTrac’s 2007 report.
And this video is a good representation of what’s going on down in Florida right now.
