The Home Crowd

Recently, in Miami and Las Vegas, the news broke on BankUnited’s blacklist of condominium properties. BankUnited as well as other lenders have adjusted their guidelines and will not write loans for properties named on the BankUnited list published by the South Florida Business Journal as well as other projects and geographic areas. Now, lenders in this market are not able to establish a value-to-loan value on these condo projects, and have established their guidelines based upon these factors -

Declining market value was the biggest culprit, followed by high investor concentration — as much as 70 percent in one case. BankUnited also cited numerous foreclosures, delinquent homeowners association dues, structural-based litigation and the bank’s existing exposure in the buildings.

(from the South Florida Business Journal) – The Blacklist can be found at the article here.

photo credit: alexdecarvalho

So if you’re in the market in South Florida, you just find another lender right? Well, in december, Vertice ( Wachovia’s wholesale lending unit) stopped writing mortgages for ALL South Florida Condos. If you can find a lender who is, let me know, because I want to know what they’re doing right (and hopefully not disastrously wrong).

As of the first quarter of 2008, South Florida is the most foreclosure-prone market in the U.S., but Las Vegas isn’t far behind and is facing their own hardships as well.

Almost 70 luxury high-rise projects were planned in Southern Nevada last year, totaling 45,616 units, reports Restrepo Consulting Group, a local real estate research firm. However, only 10 of those projects have broken ground; and, 27.5 percent have been suspended or canceled. Many were victims of the souring housing market.

(From the Las Vegas Business Press) – Article here.

So, more casualties to the housing bust. The Seller looking to get out from under a property before risking foreclosure and the Buyer who finds a bargain condo that they could afford even with a traditional mortgage. The Seller is not going to find the same pool of potential buyers as they would have previously, thus leaving them to likely settle for an offer they find less than desirable. The buyer, who may already havegood credit and had been pre-approved by a lender, will find themselves blocked from an opportunity.

Who benefits from this? The buyers with the cash on hand. It seems that very few lenders are going back any prospective buyers, so those with the cash ready may find themselves with some great deals for their home/investment.