The number of “zombie” homes in South Florida has dropped from a year ago, though these distressed properties still make up a sizable part of the region’s foreclosure market.
At the end of January, Palm Beach County had 2,572 zombie homes, the name given to vacant homes in the foreclosure process. That compared with 4,301 in the same period a year ago, according to the RealtyTrac listing firm.
The current zombie total represents a quarter of all county properties in foreclosure, up from 23 percent last year.
Broward County had 3,267 zombie properties, down from 4,577, though the current total is 20 percent of the overall market, up from 18 percent last year.
Vacant homes in foreclosure are a drag on the housing recovery. The banks don’t yet own the properties, so they tend to fall into disrepair and hurt neighboring home values.
“That makes for sort of a Jekyll and Hyde market,” said Daren Blomquist, vice president of RealtyTrac. “In general, home values are going up quickly, but we still have this segment of the housing market that’s left behind.”
While the problem is improving, the share of homes is increasing because these often are problem cases mired in the foreclosure process, RealtyTrac said.
It takes an average of 946 days for a Florida home to work its way through the courts and complete foreclosure, the firm said. That’s the third-highest timeline in the country after Hawaii (1,067 days) and New Jersey (1,057).
The South Florida metro area, which includes Palm Beach, Broward and Miami-Dade counties, had 9,580 zombie foreclosures at the end of January, down 34 percent from a year ago. But the region still has the second-highest total behind the New York metro area (19,177).
Florida’s zombie properties dropped 35 percent to 35,903, but the Sunshine State still had roughly twice as many as No. 2 New Jersey (17,983).
During the housing bust, vacant properties littered neighborhoods, infuriating nearby residents and attracting vandals and squatters.
“It’s in everyone’s best interest to get these abandoned homes off the market,” said Ken Thomas, a longtime banking analyst and economist in South Florida. “Tall grass and green pools are the kiss of death of neighborhoods. It’s like a virus. One abandoned home can hurt four or five other homes nearby.”
While many vacant homes ultimately were repossessed and resold to hedge funds and other buyers, there’s still strong demand for those that remain in the pipeline.
“If there was a source of homes that was ready and available, and priced correctly, they would sell immediately,” said Scott Agran, president of Lang Realty in Boca Raton.
“The real frustrating part is that you have investors clamoring for properties to fix up and rent or fix up and sell, but they don’t have access to them,” said Lex Levinrad, head of the Distressed Real Estate Institute, a club for investors in Palm Beach and Broward counties.
“It’s a shame there isn’t a more streamlined way to get these properties into the hands of investors.”
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