Home values are being negatively affected by an increasing amount of foreclosures
Orlando Florida Foreclosure listings keep on growing, continuing to push down home values and casting a shadow over the efforts of local and state governments to stabilize and strengthen the housing market.
Orlando real estate experts say that the increase in foreclosure and short sales have caused home values to slide down even further. They said that home sellers are forced to reduce the sale price of their properties to be able to compete with discounted prices of foreclosed homes. Sometimes buyers are having to bring more money to the table because of the property not appraising. Many times, a reduced property value could kill a sale.
Lenders will usually determine the loan amount based on either the appraised value or purchase price of the property, whichever is lower. In the event that appraisals come in at a lower amount than the purchase price, then either the buyer needs to bring more money to the table in order to obtain the financing or the seller will have to accept a reduction in the purchase price. Because of the volume of foreclosure houses and short sales, many homes listed for sale are priced well below the fair market value.
Although Orlando short sale experts say that home prices are showing some signs of stability. A great number of distressed foreclosure home and short sales still need to be closed and then cleared from banks’ inventory before the housing market could reach any kind of stability.
