The Daily Soak - May 27

Abandoned Homes Keeping Florida Contractors Busy

North Florida is a beautiful part of the Subprime State...lush countryside, horse farms, rolling hills. Now, according to the New York Times, we need to add vacant homes to that list. Jacksonville area contractors, who can earn up to $10,000 a month, have been inundated with new business. The director of their trade association, the National Association of Mortgage Field Services, estimates most contractors specializing in foreclosures have doubled their revenue over the past year. Angry homeowners and random vandals are the main culprits for the damage being done to vacant homes, but more and more banks are offering "Cash for Keys" incentives to reduce the number of break-ins and vandalism.


HousingBath Has Furniture Stores Offering Deep Discounts

If you thought 30% home price reductions were drastic, you haven't been to a furniture store lately. The HousingBath environment means tough times for the furniture industry, and sales at large national chains like Haverty's are weak. For those in the market for new furniture like the Florida couple in this story, discounts up to 75% await. But considering the outrageous markups in the industry, the furniture retailers are probably still making money. As one store owner quipped, "You know, we're happy to make a few dollars on a sofa where we were making a few hundred dollars on a sofa before." And for those like me selling furniture to make mortgage payments, there is always Craigslist...and business in Miami is brisk.


Florida Consumer Confidence Hits All-Time Low

Most of the headlines today focus on the fact that home prices dropped 14% in the first quarter of the year; yet, another more telling indicator for us Floridians has also plummeted. According to researchers at the University of Florida's Survey Research Center, our state consumer confidence index fell to its lowest level since December 1991. The index is made up of five key components including perceptions of personal finances compared with a year ago and overall outlook for the year ahead. Center Director Dr. Chris McCarty estimates Florida housing prices will hit bottom in July; however, he cautions "significant increases in housing prices are years away."