Are Sarasota’s Zombie Foreclosures Exorcised Finally?


SARASOTA, FLORIDA, October 7, 2019 – Property values of communities in the Sarasota-Manatee region now face lesser threat from neighborhood eyesores brought about by abandoned, foreclosed homes. Known in the real estate trade as zombie foreclosures, these properties have shrunk significantly in the region. According to an August report of ATTOM Data Solutions, abandoned homes account for only an estimated 4.9 percent of all the area’s foreclosed residences.

A total of 1,518 foreclosed residential properties were reported at last count in the two counties. Out of these, only 74 are zombie foreclosures, down from 77 in last year’s ATTOM data and from the 111 it recorded in 2016.

Sarasota-Manatee, as a result, improved its standing among the 158 major U.S. metropolitan areas ranked according to the number of foreclosures. From 24th place last year, the region came in better at 29th in the most recent ATTOM reading.

Charlotte County has also trimmed its zombie foreclosures of late to 4.2 percent of total distressed properties. In the latest ATTOM research, 12 foreclosed homes were reported as abandoned by their owners, down from 16 residences tallied previously.

In all of Florida zombie foreclosures slipped by 116 units for a 4.0 percent rate. Nationally, the Sunshine State ranked second in the number of abandoned foreclosed homes with a total of 1,634 residences.

Overall on the national level, ATTOM noted that zombie foreclosures have declined significantly. The real estate data cruncher estimated the national average of abandoned foreclosed homes at 3.2 percent of total foreclosures. It attributed the improvement to the current housing boom which is now on its eighth year.

Foreclosure Incidence Tamed

Meanwhile, a recent separate analysis showed that the overall foreclosure rate in the Sarasota-Manatee region has dropped to 0.5 percent of all mortgaged properties. This reading, released in September by research firm CoreLogic, compares with the 0.7 percent for all of Florida and the 0.4 percent across the U.S.

CoreLogic likewise noted that the 30-day mortgage delinquency rate in the Sarasota-Manatee area has normalized after a spike because of the adverse effects of Hurricane Irma in September 2017.

Local homeowners behind by at least 30 days on mortgage payments as of May this year constituted 2.5 percent of all mortgages in the region, according to CoreLogic. This delinquency rate compares with the 4 percent recorded a year earlier.

Among the 381 U.S. metropolitan areas which CoreLogic analyzed in its latest report, the Sarasota-Manatee area came out with the 90th lowest rate for 30-day delinquency. The reading for all of Florida on early stage delinquency also showed a marked decline to 3.9 percent from 6.9 percent. The national rate likewise saw a drop to 3.6 percent from 4.2 percent primarily because of robust income growth.

Home Flipping on the Wane

Local home flippers, investors who typically draw profits from rehabbing and selling foreclosed residences, appear getting the shorter end of the stick as the foreclosure pressure eases further. An ATTOM research showed that flips or homes sold a second time within 12 months in Sarasota and Manatee dropped 5 percent in the 2019 second quarter from a year earlier. The 302 flips recorded during the recent three-month period was also down by 3 percent from the 2019 first quarter.

Flippers’ profits are also on the wane, with the median gross profit of $57,750 on an April-June flip down by $7,250 from a year ago. The median selling price of flips in Sarasota and Manatee was estimated at $220,000 in this year’s second quarter. It took 197 days for these properties to sell, longer by five days than last year.