Out-of-Towners Covet Florida Real Estate, Locals Scratch Heads

florida foreclosureThe grass is always greener on the other side – even if said yard is located in one of the states hit hardest by the foreclosure crisis.

A new report by listings company Trulia Inc. reveals that one in three home searches cross state lines, and seven out of 10 of the most popular real estate markets perused by out-of-towners are in Florida.

The study looked at listing search data between Oct. 1 and Dec. 31 that compared incoming property searches from out-of-towners against the number of outgoing searches by locals. The results were narrowed to include only listing views from at least 100 miles away from a property.

Florida Dominates Most-Desired-Properties List

In the most popular market for out-of-towners, the metro area of Palm Bay-Melbourne-Titusville, Fla., there were nearly nine times more inbound searches than outbound. This may be surprising to locals, who are intimately more familiar with the area's housing woes. One in every 205 homes in Palm Bay received a foreclosure filing in Dec. 2011, according to RealtyTrac Inc. -- more than triple the national rate of 1 in 634 foreclosure filings.

But it's not the foreclosures that are attracting house-hunters, but the price declines that they signal, said Jed Kolko, chief economist for Trulia.

Kolko told AOL Real Estate that "Florida has the worst of both worlds -- big price declines, and a slow judicial process for foreclosures" which further delays the local housing recovery.

Foreclosures in the third quarter of 2011 sold for an average 34 percent cheaper than conventional sales, according to RealtyTrac. Couple steep discounts with snowbirds' perennial quest for sunnier, happier places to live, and Florida's dominance in the report makes perfect sense.

Furthermore, because of both the huge backlog of homes in some stage of mortgage default and the slow judicial process used to mediate foreclosures in the state, Florida's home prices aren't likely to rise to anywhere near the pre-boom peak for many years. From start to finish, foreclosures take 806 days to complete in Florida, according to RealtyTrac. The national average is 348.

Popular metros outside the Sunshine State include Tulsa, Okla., the Riverside-San Bernadino-Ontario area of California, and South Carolina's Charleston-North Charleston-Summerville region.

Where Homeowners Want Out

On the flip side, Trulia calculated the top metro areas where locals are looking elsewhere for real estate. By calculating the ratio of outbound listing views to local listings, they arrived at a list of mostly bigger (and comparatively more expensive) cities where residents are searching for a way out.

Topping the list is the area of Newark, N.J, and Union, Pa., where more than three times as many outbound listings were viewed than local ones. San Jose, Calif., Washington, D.C., Philadelphia and Bethesda, Md., rounded out the top five.

But whether prospective homebuyers are looking to buy in or get out, what's driving their search behavior is affordability, Kolko observed. That said, today's looky-loos may not necessary become tomorrow's buyers -- tight credit and larger down-payment requirements may stop many house-hunters in their tracks. When the economy begins to shift, however, expect many of these markets to reap the benefits of pent-up demand.

CORRECTION: A previous version of this article referenced Palm Beach as part of the Melbourne-Titusville, Fla., metro area. It should have identified that city as Palm Bay.

Taking Inventory: Foreclosure Finds Across the U.S.
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Out-of-Towners Covet Florida Real Estate, Locals Scratch Heads

Location: Trenton, N.J. 
Average Foreclosure Discount: 67.8 percent

Price: $198,500
Beds/Baths: 3/2
Sq. Ft.: N/A

Trenton ranks No. 1 on RealtyTrac's list of cities with the steepest foreclosure discounts. This single-family, whose price was slashed recently, represents one of the killer deals you can find in the city. 

See more foreclosed homes in Trenton, N.J.

Dating back to the 1960s, this Cape Cod-style home offers three bedrooms and two baths. Judging by the average foreclosure discount of New Jersey, the home could be running as much as $150,000 below market value. 

Location: Atlanta 
Average Foreclosure Discount: 49.67 percent

Price: $3.75 million
Beds/Baths: 7/10
Sq. Ft.: 22,000

Foreclosed homes in Atlanta are selling for a staggering 50 percent off, according to data from RealtyTrac. This vacant Mediterranean mansion offers a rather excessive four kitchens along with amenities that include a home theater, pool, spa, steam room and elevator. 

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With its gleaming double staircase, the foyer's richly finished, sparkling-clean interior contrasts with the scene at many foreclosed homes, which often show neglect. 

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At a whopping 22,000 square feet, the home's cavernous interior is distinctly palatial.

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Location: Houston
Average Foreclosure Discount: 48.14 percent

Price: $4.29 million
Beds/Baths: 5/9
Sq. Ft.: 12,129

It may be hard to believe that $4.29 million is a below-market price, but given that this stucco Mediterranean is bank-owned and Houston's foreclosure discount approaches 50 percent, odds are that the home could be quite a deal for a well-heeled buyer. 

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The home has a stone exterior and tile roof, along with a courtyard, pool and outdoor kitchen. The interior stretches 12,129 square feet. 

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After weaving around columns and through arched doorways, you reach the home's library or its fully-contained suite, accessible through its own entrance. 

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Location: St. Louis
Average Foreclosure Discount: 54.61 percent

Price: $89,900
Beds/Baths: 3/2
Sq. Ft.: 1,342

This brick-built home, which dates back to 1930, probably hit the market at a reduced price to begin with, but now is running even lower, having just undergone a price cut. The home offers stained-glass windows and wood flooring along with a spruced-up kitchen. 

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Pictured here is the home's updated kitchen. The residence is even more of a deal if you factor in its purported HomePath Mortgage status. That means if you've got the right credit, you could snatch it for as little as 3 percent down. 

See more foreclosed homes for sale in St. Louis.

Location: Lansing, Mich. 
Average Foreclosure Discount: 44.31 percent

Price: $124,900
Beds/Baths: N/A
Sq. Ft.: 2,228

Squeezed into a condo community, this historic home stands out in the neighborhood because of its stately portico. The home has a long residential tradition, but could go commercial if the buyer so chooses: The house can serve as an office, according to the listing. 

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The home's portico gives it a tinge of the pastoral era in which it was built. The classic was constructed in 1855. 

See other foreclosed homes in Lansing, Mich.

Location: Grand Rapids, Mich. 
Average Foreclosure Discount: 43.45 percent

Price: $289,900
Beds/Baths: 4/4
Sq. Ft.: 4,339

You get a lot of bang for your buck if you buy  this four-bedroom contemporary. Located on a cul-de-sac, the home spans a generous 4,339 feet and offers a three-car garage. At under $300,000, that makes it an affordable luxury residence.  

See more foreclosed homes in Grand Rapids, Mich. 

Along with its expansive interior, the home also boasts its own heated greenhouse, along with a theater and office. 

See more foreclosed homes in Grand Rapids, Mich. 

Location: Flint, Mich. 
Average Foreclosure Discount: 21.55 percent

Price: $109,600
Beds/Baths: 4/3
Sq. Ft.: N/A

Purchase a foreclosed home in Flint and you're likely to enjoy the benefit of more than 20 percent off. While the city's foreclosure inventory doesn't offer deals quite as striking as those found in some other cities wracked by the housing crisis, the town's average foreclosed-home price still falls far, far below the national median (which hovers above $200,000). Flint's average foreclosed-home price is just $60,578. This well-landscaped home demonstrates how far just $110,000 gets you. 

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The home may be a bit bare-bones now, but as the listing asserts, the home has "lots of potential." It comes with a pool, a deck and a two-car garage. 

See more foreclosed homes in Flint, Mich. 

Location: Tampa, Fla. 
Average Foreclosure Discount: 24.97 percent

Price: $143,900
Beds/Baths: 6/4
Sq. Ft.: 2,920

At just $49 per square foot, this cheery home in Tampa, Fla., a city that took has taken a real shellacking from the housing crisis, offers of six bedrooms. 

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The bank-owned property spans nearly 3,000 square feet and boasts a well-equipped kitchen with cherry-stained cabinetry and marble countertops. 

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Location: Easton, Pa. 
Average Foreclosure Discount: 41.17 percent

Price: $29,900
Beds/Baths: 3/1
Sq. Ft.: 1,556

Alright! A listing description that levels with you. "This is a property that needs some work," it states. The home is not without its virtues, however: It offers ample space, three bedrooms and an attic. Furthermore, buyers can acquire 3 percent buyer's assistance if they make an offer by the 31st of this month. 

See more foreclosed homes in Easton, Pa.

One thing buyers should watch out for if they think about shelling out for these digs is that, as with many other foreclosures, there is no seller disclosure for buyers interested in this home. That means, unless you pay for a thorough inspection, you could discover hidden flaws after purchasing the place. 

See other foreclosed homes in Easton, Pa. 

Location: Chattanooga, Tenn. 
Average Foreclosure Discount: 40.39 percent

Price: $129,000
Beds/Baths: 3/2
Sq. Ft.: 1,456

This staid but cozy home is running for $129,000, about $40,000 over the average foreclosed home price in Chattanooga. The home offers a nice porch and decently finished interior. 

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Pictured here is the home's open dining-kitchen area. The place seems to be in pretty good shape for a foreclosed home. Many fall into poor condition, succumbing to insect infestations or other symptoms of neglect. 

See more foreclosed homes in Chattanooga, Tenn.


See also:
Foreclosure Action at Lowest Level Since 2007
Foreclosure Discount Capitals: Where They're Worth It
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