The Daily Soak - July 31

Half-built Communities Offer Surreal Environment, Great Deals

Some notions are half-baked, some efforts are half-hearted, and a growing number of Florida housing developments are simply half-built. The News-Press examines the uneasy feeling residents and developers share in communities where sales and construction have come to a grinding halt. Projects like Concordia in Cape Coral and Bella Casa in Fort Myers offer an odd visual juxtaposition of new amenities and unfinished homes which can potentially scare off new buyers. "Unfortunately, with them sitting there like that, it provides a huge negative connotation that this project went bust," says Fishkind & Associates' Michael Timmerman. But the good news for potential buyers with a long-term outlook is that half-built often means half-price...or lower. Units at Concordia that sold for $267,000 just two years ago can now be bought for around $100,000. The News-Press reports larger investors are making offers to purchase all of the remaining units in some unfinished communities for 20 cents on the dollar. (Slideshow)


High 'n' Dry: Florida's Boating Industry Motor Sputtering

Florida has over 1 million registered boats, but you wouldn't know it by looking at traffic on the Intracoastal. NPR interviews several Florida boat owners, dealers and charter captains to assess the impact of the weak economy on the boating industry. "Anchor More. Cruise Less." is the mantra of one Miami owner who forks over $250 just to fill-up his 17' outboard. The owner of the Cozy Cove Marina in Dania Beach, which features boats like the $250,000 Jupiter 34, says sales are down 50% compared to last year. And the Islamorada charter captain of the 43' Yabba-Dabba-Do says "the economy is whittling away customers. People are spending less and fewer now are willing to put out the $1,400 it costs for a full-day of deep sea fishing." HB.com featured the lone beneficiary of the weak Florida boating industry back in May: National Liquidators, the nation's largest marine repo company. The company currently has repo'd boats double-stacked on six 400-foot docks in Fort Lauderdale. (AudioClip)


Orlando Tourist Attraction Goes Into Foreclosure

A Boston bank that loaned $43 million to the developer of Orlando's Church Street Station has filed for foreclosure. Originally built in the mid 1970's, Church Street was bought out of bankruptcy court last year after former owner/boy-band producer/convicted money launderer Lou Pearlman was sent to prison. New owner Cameron Kuhn of the Kuhn Companies sought to revamp the complex with more upscale dining and entertainment alternatives, and the Orlando Sentinel wrote an upbeat analysis just 9 months ago. But business at CSS has been sluggish due in part to construction traffic related to the 55 West high-rise condo across the street. Stores will remain open as usual while Tremont Net Funding works to reclaim the property, and some speculate the opening of a new I-4 off-ramp next month will lure more locals and tourists. (VideoLink: A 1984 home video of CSS when the complex was Florida's 4th-largest tourist attraction after Disney, Sea World and Busch Gardens.)

The Daily Soak - July 30

Extreme Makeover: Foreclosure Edition

ABC's lame home improvement melodrama has an annoying habit of building mega-houses for ingrates who are prime candidates for the Darwin Awards. Case in point, the Tate family in Tampa were painted as "victims" after a plane crashed into their living room, when in reality they were too stupid to buy home insurance. Now news out of Georgia that the Tate's have been one-upped by the Harper family. It seems EM gave the Harper's a brand new $450,000 home in Lake City (which would be the most expensive home in town, per Trulia) and enough cash to pay their property taxes for 25 years. So what do the Harper's do? Relax and enjoy their new crib? Pay off their other debts? Give thanks for their good fortune? No, they decided to double down and take out a $450,000 loan against the value of the house. Now that they've defaulted on that loan, Chase is forcing foreclosure on Casa Darwinia. If you're always dreamed of owning a slice of really bad reality TV, it's yours here for the taking. (VideoLink: Patricia Harper can be seen in her driveway wearing a "Save Energy" t-shirt. Her "Save Money" t-shirt must have been in the wash.)


Extreme Defaults: WCI Edition

Coincidentally, Bonita Springs developer WCI built the Extreme Makeover home in Tampa. The WCI management team probably thought it would be a nice diversion in 2007 from the plummeting stock price and record high-rise defaults. Judging by the company's second quarter earnings report released yesterday, WCI could use another reality TV diversion. The company's losses more than tripled to $100.2 million in the second quarter bringing losses for the year to $184.3 million, and WCI is now in default on several of its loan agreements. Real estate analyst Jack McCabe says the outlook is beyond grim, “As far as them surviving this, it may be 1 in 5. Chances are extremely slim that anybody is going to step up to the plate to try to save this company, prior to them filing for Chapter 11." Reacting to yesterday's news of record cancellations, defaults and contract recissions, New York credit analyst Vicki Bryan put a poetic spin on her stock summary, “At long last, it appears that the curtain is falling on WCI.


HousingBath.com: "We're Ridin' the Wave of the Future"

BusinessWeek says the surge in second quarter foreclosures took everybody by surprise, but the news has been a boon for Web sites catering to the needs of homeowners facing foreclosure. comScore reports the Web saw 1.8 billion searches for the term "forelcosure" in June alone, a 117% increase over last year, and sites like Foreclosure.com, Zillow and Trulia are posting double and triple-digit increases in site traffic. (Chart) Demand for reputable real estate attorneys is also good news for a brilliant site like Avvo.com which lets users rate attorneys in their area. A quick search of Miami turned up 253 real estate attorneys...some highly recommended, others...not-so-much. HB.com jumped on the distressed real estate dotcom train earlier this year and is committed to delivering news and information that can help desperate Florida homeowners "Get Out of the Tub." Sincere thanks to the over 10,000 visitors who have turned to The Daily Soak since May. Just like Stewart and Mr. B. in that classic Ameritrade commercial, "We're Ridin' the Wave to the Future." Rock on.

The Daily Soak - July 29

Just "Bouncing Along the Bottom" in Southwest Florida

Fishkind & Associates real estate analyst Michael Timmerman delivered an upbeat housing forecast yesterday during the Urban Land Institute's "Market Trends: Are We There Yet" meetings held in Naples and Fort Myers. On the Southwest Florida housing status quo, Timmerman said, “We’ve finally gotten to the point where we’ve reached a bottom as far as housing starts, existing home sales and new home sales. We’re kind of bouncing along the bottom. I don’t think we’re going to see any reduction in volume again." Looking down the road, Timmerman feels potential buyers will clear another psychological hurdle once we know who our next president will be. “Once we get past the election, that’ll get people to the point of ‘OK, now we know what our leadership is.’ And depending on where they are, who they are, they will begin to move forward.” Following that logic, we're only 97 days away from renewed buyer interest.


Cultural Elitists Bash Proposed Wal-Mart for Downtown Miami

Thousands of new condominiums have come online in Miami's downtown corridor since 2005, but there's one big problem: the dearth of big box retailers means residents must drive 15-20 miles to shop for affordable goods. Fortunately the success of a recently opened Midtown Target has prompted the boys from Bentonville to consider building a Wal-Mart in downtown Miami to anchor the ambitious CitySquare project. While most downtown residents welcome the news, some elected officials are turning up their noses and casting rather pathetic stereotypes. "Visualize a Wal-Mart customer in his pick-up truck, and family of four, driving past tuxedo-clad Arts Center guests,'' opined one elitist commissioner's aide. Developers are quick to point out the downtown Wal-Mart would obviously be designed to blend with the more modernist CitySquare, while the world's largest retailer is also giving greater thought to revamped interior design. Downtown residents like Fred Joseph may have some initial NIMBY reservations, but when pressed by the Herald on whether or not he would shop there he confesses, "Yes, I love Wal-Mart.''


Why The $300 Billion Bailout Will Promote Victimhood

Fresh off this month's Florida hatchet job, Time returns to South Florida to tell the world about the HousingBath. And what better place to showcase a recovering housing market than a city where half of the homes and almost all of its condos are geared toward low-income residents. Miami Gardens provides the perfect backdrop for Time to extol the virtues of the $300 billion housing bailout and really pump the victimization angle. In so doing, The Foreclsoure Crisis: Who Gets Help unearths one of the bailout's fatal flaws: the subjective nature of allocating billions once those dollars trickle down to the local level. Local government officials are already salivating at the prospect of doling out billions to their constituents in an election year and "envisioning rules for the federal aid when it reaches Miami Gardens." So how will they decide if a homeowner like Tatrisha Harvin is truly a victim for not having read her loan docs? Harvin doesn't seem worried. When asked her thoughts on the $300 billion bailout, her response somehow rings less than grateful. "Seems the least they could do."

The Daily Soak - July 28

4 Years After Frances, Palm Beach Condo Residents Coming Home

Frances...Jeanne...Wilma...3 names residents of the Singer Island Tiara condominium won't soon forget. The 2004-05 hurricanes rocked the 320-unit high-rise and forced the evacuation of all of her residents. Images of the Tiara's exposed facade and gutted units were staples of nightly news broadcasts post-Frances transforming the luxury condo into what the Palm Beach Post called "a symbol of the perils of coastal living." Insurance only covered 60% of the $140 million condo renovation project, so evicted residents had to pay average special assessments of $130,000 on top of $10,000 a year in taxes and HOA fees. And believe it or not, now comes the hard part: moving back in 320 displaced unit owners and all of their furniture and appliances...with only 2 working elevators. Residents can also look forward to another $4 million assessment in order to rebuild their tennis courts, garage roof and gazebo. Originally built in 1976, the Tiara remains the tallest building in Palm Beach County.


Move Over, Furby: Florida Homeowners Try Their Luck On eBay

It was only a matter of time. Long considered the domain of cheap collectibles, eBay (Chart) began making inroads in the U.S. car market when the site launched eBay Motors in 2000. Today, an automobile sells on the site every 52 seconds accounting for $18 billion a year in revenue. With a sizable segment of U.S. consumers comfortable with the concept of buying autos via online auctions, eBay has moved on to the next logical big ticket item: real estate. Over 600 Florida real estate auctions are currently posted on eBay ranging from raw land in Punta Gorda to Disney timeshare deeds to a new loft in downtown Miami. Reviews so far have been mixed with Florida homeowners, according to Susan Taylor Martin's article in the St. Pete Times. Sellers say their listings are often met with skepticism from potential buyers, but they won't pass up an opportunity to showcase their homes for eBay's 84 million users.


Community Bank Takes A Measured Approach to Foreclosures

Last week HB.com covered the foreclosure panic facing many Southwest Florida community banks, but an Englewood-based bank is taking it all in stride. Despite $38 million in past-due loans, Peninsula Bank has only filed $5 million worth of foreclosure suits on a mere 13 properties. CEO Simon Portnoy acknowledges Peninsula made some bad loans ("Things got away from us a bit."), but he is comfortable renegotiating loan terms with the majority of his borrowers like Miami-based Sarasota Palms LLC which is doing a condo-conversion project located here and Michigan-based Punta Gorda Hotel LLC which bought and old waterfront Best Western in Punta Gorda. And even if some of Peninsula's borrowers eventually default, Portnoy is bullish on the bank's role in the burgeoning REO sector, "We are strict underwriters and effective collectors. We have a lot of equity and a lot of people want to buy foreclosed properties from us."

The Daily Soak - July 27

"35 Years Old And Living With Mommy"

In the new movie Stepbrothers, Will Ferrell plays Brennan Huff, an unemployed 39 year-old who lives with his mother, Nancy. Unfortunately for some Floridians, Stepbrothers probably feels more like art imitating housing reality than an irreverent comedy. Despite dramatic price reductions in recent months, current home prices have still not crossed the threshold of affordability for many Floridians. Middle school teacher Lyssa Fordin says, ''It doesn't look good anytime soon. The prices combined with the taxes and the insurance are outrageous. . . . I'm a college graduate, 35 years old but living with Mommy." So the Miami Herald poses the following question to a panel of real estate analysts, "How long can prices remain so high that most people can't afford them?" And the general consensus..."Broward and Miami-Dade County home prices are now down more than 20 percent from their 2005 peaks. But prices remain startlingly high in relation to local incomes, suggesting that they still have further to fall." Good news for Brennan Huff's Mommy.


A Tale of Two Markets in Southwest Florida

The Sarasota Herald-Tribune highlights the growing disparity between the single-family and condo markets in Southwest Florida. While single-family sales are firming up and actually posting year-over-year increases in some Southwest Florida counties, the headline sums up the multi-family status quo..."Condo Sales in Region Swoon." Real estate analyst Jack McCabe describes the impact of pre-Bath condo speculation, "People were placing pre-construction deposits in groups or bundles. They were buying three, four, five at a time. But when it came to closing on those units, many buyers chose to walk away and builders got caught with unsold inventories." The end-result is a spillover effect of defaults to condo developers who are defaulting on loans for projects like the $23 million Riviera Dunes. McCabe, who sees more foreclosures like Riviera Dunes on the horizon, estimates flippers accounted for 40-50% of single-family purchases and 70-80% of condo purchases during the boom.


"Isn't It Better To Be Robbed Over The Phone Than At Gunpoint?"

Best-selling novelist and Herald columnist Carl Hiaasen has a unique take on the mortgage mess, because "after you live in Florida long enough, you learn to look philosophically for the silver lining in every storm cloud." Like most, Hiaasen is baffled by the number of career criminals who were granted mortgage licenses, but rather than dwell on the $85 million in mortgage fraud they unleashed on unsuspecting homeowners, he views the granting of mortgage broker status by the state's OFR as positive job rehab. While holding their licenses, a former coke dealer stopped selling coke, a habitual car thief stopped stealing BMWs, and a convicted wife killer stopped killing wives. As for OFR Chief Don Saxson, who will be grilled this week in Tallahassee, Hiaasen again takes the high road..."Maybe Saxon's been asleep at the switch, or maybe he was simply trying to keep known criminals off the streets by putting them behind desks instead. Isn't it better to be robbed over the phone than at gunpoint?"

The Daily Soak - July 26

One-in-Four Florida Home Sales Are Foreclosures

The number of foreclosure sales is rising rapidly nationwide, and BusinessWeek compiles a state-by-state list of second quarter foreclosure sales including sales of bank-owned properties, auction sales, and short sales. While California tops the list, Florida tied for fourth with foreclosure sales (52,651) accounting for 25% of total home sales (213,099), up significantly from the 6% number recorded in 2Q07. Moody's senior economist Aaron Smith describes the "negative feedback loop" that exists in many foreclosure saturated markets, "Prices decline, so you have more foreclosures, and then more price declines, but it's better to have activity than not." In closing, BusinessWeek also points to the silver lining, "The good news about the jump in foreclosure sales is that it's pushing up existing-home sales in some communities, and that could help to clear out languishing inventory." (SlideShow)

Jacksonville Beach Developers Proposing More Apartments, Hotels

With the condo market officially saturated, real estate developers in Duval County are getting the green light to move forward with something Jacksonville Beach really needs: apartments and modern hotels. According to the Florida Times-Union, "Alliance Residential Co. has estimated it will spend roughly $15 million to build the Broadstone at Jacksonville on Shetter Avenue, an apartment complex that involves the construction of 13 buildings. Timing appears to be in Broadstone's favor, because the market for apartments has improved while single-family home construction has declined." In addition, two new hotel projects are in the works: an 80-room Sheraton from developer Shivam Properties and an 80-room luxury boutique hotel scheduled to be built in downtown Jacksonville Beach. Shivam originally planned office condos on the Sheraton site, but the company switched gears when that market began cooling last year.

Regardless of Size, Banks Increasing Write-offs, Loan Loss Reserves

With auditors closing the books on the second quarter, commercial banks are beginning to share some grim news with shareholders. HB.com has chronicled the financial woes of Florida's largest home lender, Wachovia, and the company's $9 billion second quarter loss recently led to stock downgrades and a CFO's departure. Two articles today demonstrate the fact that residential home loan concerns extend to smaller, regional banks in Florida. In an earnings call this week, Stuart-based Seacoast Banking Corp. (SBCF) revealed it has written off one-third of it's $100 million real estate portfolio. CEO Dennis Hudson said the bank "was gearing up for massive liquidation sales as it attempted to move past its distressed real estate portfolio." And over on the Gulf Coast, Sarasota-based First State Financial (FSTF) is boosting loan loss reserves, a proactive measure meant to cushion the potential blow from future write-offs. Here is a one-year chart comparing the stock performance of all three banks.

The Daily Soak - July 25

U.S. Housing Numbers Still Moving in Wrong Direction

Sales of new single-family homes dropped 0.6% last month, a marked improvement over the 1.7% drop in May, but still disappointing considering new home sales in the U.S. are down 33% compared to last year. The South showed the largest drop in new home sales (-2%) followed by the West (-1%); however, new home sales are actually increasing in the Northeast (+5%) and the Midwest (+2%). Sales of existing homes were down 2.6% last month to an annually adjusted rate of 4.6 million existing home sales. There are currently 4.5 million unsold homes in the U.S., according to the National Association of Realtors. On the foreclosure front, 16 California and Florida cities rank among the Top 20 metro areas with the highest foreclosure rates. According to the Associated Press, "Economists estimated 2.5 million homes nationwide will enter the foreclosure process this year, up from about 1.5 million in 2007." (VideoLink)



Central Florida Numbers Encouraging; 4x More Sales Than Miami


Data released by the Florida Association of Realtors suggest Central Florida's real estate market is rebounding nicely. Over 1,600 existing single-family homes were sold in the 4-county Orlando metro area in June, a 3% increase over June 2007. According to the Orlando Sentinel, "the figures indicated that the (region) remains one of the stronger housing markets in Florida this year, accounting for more than one in every 10 homes sold statewide." The 1,641 homes were 3x more than the number sold in Fort Lauderdale in June and 4x more than Miami. The median sales price of $219,500 was down 15% compared to last year. The much larger Tampa/St. Pete market was the only major Florida metro with more existing home sales in June (2,346); however, sales in Tampa/St. Pete were actually down 3% compared to last year and the median sales price of $178,700 was down 19% compared to June 2007.



Tampa Bay Area Foreclosures Post Sharp Increase


The year-over-year drop in existing home sales and median price aren't the only two pieces of negative housing data coming out of the Tampa/St. Pete metro area. According to the Tampa Tribune, "There were 14,960 foreclosure filings in the Tampa metro area during the second quarter. That's up 27 percent from the previous quarter and 159 percent from the same period last year. Now, one in every 87 households is receiving a foreclosure filing. The area's foreclosure rate ranked 17th among the nation's top 100 metro areas." Hillsborough County recorded the most foreclosures (6,310) in the four-county region followed by Pinellas (4,766), Pasco (2,535) and Hernando (1,349). On the bright side, Forbes ranked Tampa the number one city for home buyers exactly one year ago based on supply and demand. As supply continues rising and prices keep falling, Tampa remains one of the country's best markets for home buyers. (Top Home Buyers' Markets Slideshow)

The Daily Soak - July 24

Florida Dotcoms Partner To Pair Buyers With Distressed Sellers

HB.com is always on the lookout for creative solutions to facilitate the lengthy, intimidating short sale process, and if they're Web-based solutions from Florida-based companies, that's even better. Well, Boca Raton-based Foreclosure.com and St. Pete-based LoanResolve.com delivered this week announcing a partnership that marries LoanResolve's "state-of-the-art foreclosure resolution and loan modification engine" with Foreclosure.com's major asset, "America's largest and most accurate searchable database of foreclosed homes and investment property information." The user interface of LoanResolve is clean and self-explanatory with separate channels for sellers, buyers and realtors, while Foreclosure.com's homepage features an easily searchable U.S. map with over 2 million updated listings. This is one Florida marriage that should stand the test of time...and the HousingBath.


34 Year-Old Could Lose His $10 Million Miami Beach Crib

Hip-hop music producer Scott Storch was livin' large in 2006. Rolling Stone magazine dubbed him "Hip-hop Liberace" and noted "the hits he's produced for Dr. Dre, 50 Cent and Beyonce have earned him $70 million (and) a Scarface-worthy mansion in Miami." Storch took out two mortgages from SunTrust to purchase the $10 million Palm Island mansion complete with 7 bedrooms, 14 bathrooms, two guesthouses, an eight-car garage, killer views of Biscayne Bay and a private dock for his $20 million yacht, Tiffany. Unfortunately, it seems Storch's eye for talent slipped in recent years, as singers like Beyonce and Christina Aguilera were passed up for "artists" like Paris Hilton and Hulk Hogan's offspring. The Palm Beach Post reports that SunTrust is moving forward with foreclosure proceedings on the mansion while repo men have already seized several luxury cars including a $300,000 Ferrari Scaglietti.


Abandoned Pools Pose Health, Safety Risks in Central Florida

Inspired by the World's Ugliest Dog competition, HB.com is going to sponsor a Florida's Nastiest Pool (FNP) contest. The local news affiliate in Orlando tours several neighborhoods in Brevard and Orange Counties and finds some mosquito-ridden, trash-collecting cesspools that are prime candidates for the FNP. Local code enforcement officials are trying to work with owners and lenders to secure the perimeters of these pools, but they aren't having much luck with owners who've checked out and banks that don't feel obligated to pay for property management. Banks and homeowners who don't comply are fined $250/day, but the threat of fines doesn't seem to be stemming the rising tide of abandoned pools. The 2008 Florida's Nastiest Pool Ceremony will be held in November at this beauty in Titusville; all nominees should be e-mailed to housingbath@gmail.com. (VideoLink)

The Daily Soak - July 23

Kentucky Mayor to Tampa Residents: "Come Back Home!"

While Florida's governor is busy touring nuclear power plants over in Europe, a Kentucky mayor is planning a sneak attack to lure Floridians out of Crist's backyard. City of Louisville Mayor Jerry Abramson is hosting a recruiting event Thursday night in Tampa to encourage former Kentuckians to move back home. The Courier-Journal says the mayor is capitalizing on the weakness of the Tampa job market and the fact that Forbes just named Tampa the worst major metro area for young professionals for the second straight year. So what does Louisville have to offer? "Shorter commutes, a lower cost of living (and) one of the nation's largest parks systems," according to the city website, and golf fanatics can look forward to the 2008 Ryder Cup which the city hosts this fall. Sources say Mayor Abramson is traveling with premium bourbon and Derby tickets to help lure Tampa residents back to the Bluegrass. (VideoLink)


Mosquitoes + Swimming Pools + Foreclosures = "Soupy Messes"

HB.com reported last month on the rising number of mosquito pool parties being held around Florida, and now the Orlando Sentinel looks at how the problem is impacting some Central Florida neighborhoods. Facing rising budget deficits, some county governments are cutting back on their mosquito-control programs. Eddie Hovarth, the Seminole County program director confessed, "We have too many pools to deal with all of them...We're so overwhelmed." While Hovarth is considering putting mosquito fish on the county payroll, resourceful Floridians posted more direct approaches on the Orlando Sentinel website. TheRunningNurse suggested, "Hop the fence and dump about 5 gallons of straight Clorox in the pool." To which PappyBuc replied, "AND IT WORKS!!! We used 6 gallons." So how long before the Save the Mosquitoes lobby cracks down on the evil chemical warfare being waged in Florida against these lovable larvae?


It's Not A Category 5, But Homestead Still Feels the Pain

Few American cities have felt the full frontal impact of a natural disaster the way Homestead was steamrolled by Hurricane Andrew sixteen years ago. But with the devastation came an opportunity to re-brand and re-build, and that's exactly what the city did. The Daily Business Review writes, "Thousands of new homes replaced tomato fields during the housing boom in the early part of this decade. Homestead’s population swelled from about 32,000 in 1999 to more than 50,000. In the era of $2 dollar per gallon gas, the town had reinvented itself as a bedroom community of Miami." Fast forward to the era of the HousingBath, rising unemployment and $5 gas, and Homestead has become one of the weakest housing markets in Miami-Dade, if not all of Florida. One real estate analyst estimates 30-40% of all home sales in Homestead today are distressed. The Daily Business Review put together this audio slideshow.

The Daily Soak - July 22

Condo Joy: Spittin' Seniors Stand Between A Man & His Boat

Tampa Bay resident Bobbi Desotello has two prized possessions in this world: his unit at the Bay Point condominium and his fishing boat. Unfortunately Bobbi's unit shares a terrace with a unit occupied by two grumpy seniors, and he has to walk past their sliding-glass doors just to get down to the dock. It seems the Bay Point complex has long terraces that connect multiple units with single stairways only at one end, so 108 of the 136 unit owners have to walk in front of a neighbor's unit in order to get to the dock. But at your own risk says Desotello, "I get yelled at, screamed at, cursed at, threatened, spit on." While county officials say the angry neighbors may have a valid claim to private property rights, Channel 10 reporter Janie Porter asked the logical question, "Is it really that big of a deal?" To which the grumpy old man replied in defense of his wife, "Yes, she wants to walk here naked." That disturbing visual forever etched in her memory, Porter is currently recovering at Tampa General. (VideoLink)


Florida Media Outlets Punk'd by WCI Fax Hoax

Struggling Bonita Springs-based homebuilder WCI Communities has been the focus of buyout rumors in recent weeks, but some prankster decided to make it unofficially official by sending a fake press release to local media outlets. A fax sent to the Naples Daily News over the weekend stated that WCI "today announced that it has received a bid of $5.25 per share to WCI’s board of directors to purchase the company, a deal potentially worth $220 million.” The news sent WCI shares soaring over 30% this morning from yesterday's closing price of $1.25. WCI countered with a legit press release around 10:30 to quell the buyout rumors, and the duped media outlets quickly pulled the story from their websites. Bloggers like wsdnaples1 posting on the Naples Daily News website expressed sympathy for the sinking homebuilder, "Hey WCI the party is over!!!" WCI shares finished the day in their historical trading range between the price of a Double Gulp and a Super BigGulp.


'Bama Banks Losing Millions on Failed Florida Developments

Alabama-based Regions Bank and AmSouth, the smaller Alabama bank it acquired last year, are no strangers to bad real estate deals in Florida. AmSouth's problems began in Fort Lauderdale last year where it is owed $18.6 million from the developers of a bankrupt condo project. Now Regions is seeking repayment of $23 million in loans from Waterford Companies, the developer of the 12-story, 58-unit Palms at Riviera Dunes in Manatee County. Only 14 of the Palms units ever sold, so Regions wants to recoup and sell the stalled project. According to Regions' lawsuit, "The defendant does not have the financial capability of seeing that the condominium project proceeds forward while maintaining the costs associated with running the common areas." Considering current events, Waterford management may be rethinking the corporate tagline at the top of their website.

The Daily Soak - July 21

Over 1,000 Ex-Cons Found Steady Work as Florida Mortgage Brokers

The Miami Herald published Part One of a 3-part series, Borrowers Betrayed, which identifies the primary culprits for our current mortgage mess. The first installment focuses on "The Brokers," and specifically the staggering number of ex-convicts who were able to find gainful employment as Florida mortgage brokers. As the number of new licensees rose with the housing boom, so did the number of new licensees with criminal backgrounds. The State's Office of Financial Regulation granted licenses to admitted felons like Scott Almeida (cocaine trafficking), but others like Kissimmee broker Donald Smith covered up their past offenses (strangling his wife and dumping her body into Tampa Bay). Brokers like Almeida and Smith forged documents and processed dozens of fraudulent loans that left many Floridians homeless. While Charlie Crist begins week two of his taxpayer-funded European vacation, the finger-pointing in Tallahassee has already begun.


Weak Dollar, Economy Keep the Euros Flocking to Florida

German tourist Lars Binckebanck recently brought his family to Florida to rent an RV and tour 10 of the best beaches in the Sunshine State. In our sputtering economy, his six words are music to the ears of many Florida business owners: "We are spending. We don't care." According to Visit Florida nearly 1 million Europeans visited Florida in the first quarter alone, and many have the same go-now, buy-now attitude as Lars. The president of Visit Florida says Europeans aren't just relaxing and staying in their hotel rooms, "People are actually coming over without any luggage at all, and they not only buy clothes, but the suitcases to take it home in. That gives you an idea what a great bargain it is." The Euro is near its record high against the dollar so, as AP notes, "Europeans see an opportunity...the chance to buy a vacation home in a tropical clime."


Memo to Charlie: Stay in Europe, Sell Some Florida Real Estate

The first two news items in today's Daily Soak set the stage perfectly for Frank Cerabino's column in the Palm Beach Post. Cerabino looks around Florida and sees the mortgage mess, the Time Magazine hatchet job, State Farm's 47% rate increase request and last week's job loss numbers as ample motivation for Crist to stay in Europe. "Crist is there, in part, to tell Europeans what a good buy Florida real estate is," Cerabino explains, "and the longer he stays, the better that deal keeps getting. Coming home at this point would be too traumatic for our governor." Rather than returning to Florida and actually working to solve our problems, Cerabino feels Crist's energies would be better spent as "roving real estate ambassador to Europe, touring the countrysides of Provence, the Adriatic coast and the Pyrénées, in search of buyers for all our empty homes."

The Daily Soak - July 18

Some Like It Hot: Snowbirds Staying through Summer

It's no secret that January through April are the prime months for renting out a vacation home in the Sunshine State, but who wants to stay in those homes during the summer and endure the heat, hurricanes and mosquitoes? An increasing number of owners according to The New York Times. In what this article labels the "going-against-the-grain way of viewing vacation-home ownership," more and more owners are renting out their homes for top dollar during the peak months and learning to love the lazy days of summer. And for those owners who still refuse to deal with the summer heat, two groups of foreigners are emerging as prime rental targets: Europeans and South Americans. "I've never once run into a European who said it's too hot," says Fort Lauderdale broker Paul McRae.


"Forgive Me Father Barney...or At Least Bail-Out My Condo Project"

Another truly bizarre chapter in the ongoing saga of developer SimDag and the Trump Tower Tampa which broke ground in 2005 but was never actually built. SimDag's bankruptcy filing shows the desperate lengths the developers went to in order to secure financing for the beleaguered $300 million project. SimDag paid Indiana-based Providence Funding Inc. $150,000 in hopes Providence ("Your Faith-Based Source in Commercial Lending") would secure a $200 million loan for Trump Tower Tampa. It turns out Providence, according to the St. Pete Times, is led by "an ex-convict named Barney Canada (who) spent three years in federal prison in the early 1990s for stealing millions of dollars procuring phony loans for businesses just like SimDag." Don't expect this news to sit well with SimDag's creditors who meet in a courtroom today seeking loan repayments of almost $40 million.


Holding Pattern: State Economists Push Back Recovery Forecast

Economists in Tallahassee are still betting on a Florida recovery, but they are now pushing back their anticipated recovery start date by six months to the end of 2009. One economist blamed "higher fuel and food costs" and the "distressed housing and credit markets" nationwide that have spilled over into our state economy. The report notes more than half of the 74,000 jobs lost in Florida over the past year were tied to the construction industry and forecasts unemployment will rise to 6% by January 2009. So given Florida's current building freeze, where can state construction workers find jobs? Try Texas. The Dallas-Morning News reports today Texas added "a whopping 47,700 non-farm jobs" last month alone. With a modest 4% unemployment rate, the Lone Star State is currently adding an average of 21,000 jobs per month.

The Daily Soak - July 17

Gilded Age: A $95 Million Teardown in Palm Beach?

The Palm Beach Post reports that Donald Trump just sold a 60,000-square foot oceanfront mansion to Russian fertilizer billionaire, Dmitry Rybolovlev, for $95 million. The sprawling 6 bed/7 bath home is located in exclusive Palm Beach and comes complete with 475 feet of unobstructed Atlantic views. As if the sale didn't already have enough superlatives, the Palm Beach property appraiser's office estimates the annual tax bill will be close to $16 million. And for anyone who doubts the value of Florida oceanfront property is in the land, sources close to Dimitry say he may tear down the existing home and build a new home from the ground up. Meanwhile sources who don't know Dimitry, but like to see Palm Beach socialites bent out of shape, think it would be funny if he razed the house and converted the property into condos, a fertilizer farm or a popcorn farm. Straight out of the Al Czervik playbook.


Party On: Ultra-luxury Project Coming to South Beach

Boston developer Congress Group is moving forward with plans to build a 19-story, ultra-luxury residential tower in the trendy South of Fifth area of South Beach. The Kallisto tower will house eight 4,300-square foot residences with panoramic views of Miami and the Atlantic Ocean and two penthouses with private swim spas and outdoor bars. The project, located at 120 Ocean Drive, is scheduled for completion in 2010. Sales should be brisk according to Stephen Nostrand, of Colliers Abood Wood-Fay in Miami, “The folks looking to buy those types of residences are typically insulated from most and any economic issues that the rest of the market is feeling.” Sales of the Kallisto units, priced from $4.8 million to $13.5 million, begin October 1. (VideoTour)


Writer's Block: HousingBath Trumps Creativity for Many Sellers

Forbes reports on the cancellation of two highly-publicized essay-writing contests intended to help desperate sellers unload their properties. The contests in Oregon and Colorado "both failed to attract enough literary enthusiasm and have left the sponsors in a lurch without buyers." Closer to home, HB.com shared the story in May of an Ocala woman, Clementina Marie Giovannetti, who was sponsoring an "I Love My Pet" essay contest in hopes of selling her $1.25 million home; Giovannetti canceled her contest last month. Undeterred, a Boston developer, Davenport Investments, is now sponsoring a $50/entry essay contest in hopes of selling the 14 remaining units at the Canton Park Condominium. According to Forbes, "a week into the contest, Davenport has yet to receive any entries."

The Daily Soak - July 16

Coming Soon to An Open House Near You: The Ladies Man

Reuters reports on what some are calling "The Sleepover Strategy:" giving interested buyers the option of spending the night in a listed property before signing a contract. Orlando agent Pat Skiffington says he adopted the idea after watching the TLC show "Date My House." The popular cable show marries the speed dating concept with the traditional open house in hopes of producing a sale. Skiffington explains, "For young urban buyers, it's just perfect...you really don't get to experience that when you just go in during daylight hours." TLC takes the dating analogy to the extreme with the Top 10 Rules of House Dating Etiquette including such steamy advice as Rule #3: You can look and you CAN touch. Despite condoning loose behavior among potential buyers, promiscuous houses beware...there's no guarantee they'll call you in the morning.


Gimme Shelter: Strong Storms Toss Workers Around Miami Condo

It's summertime in South Florida and thunderstorms can come out of nowhere in a matter of minutes. One such storm materialized yesterday in downtown Miami and the high winds tossed construction workers at the Marquis from one side of the high-rise condo to the other. The building's contractor reports the scaffolding, which takes 30 minutes to secure, was not lowered in time to protect the workers. Yesterday's storms were powerful enough to shut down Miami International Airport for fifteen minutes and divert some inbound flights to Stuart. The video images were captured by a resident in a neighboring high-rise on Biscayne Boulevard. Designed by Arquitectonica, the 67-story, 700-foot Marquis recently topped-off. Upon completion in 2009, the building will be Miami's second-tallest skyscraper. The 70-story Four Seasons Hotel Miami is the tallest building in both Miami and Florida.


Save Some for A Rainy Day...Or A 20% House Down Payment

Bloomberg reports on another of the unintended consequences of the HousingBath: tougher lending guidelines may force the discipline of saving on U.S. consumers. Nick Ruiz, a Miami paramedic with good credit found a foreclosure special for $150,000 in Hialeah, but he can't come up with the $30,000 down payment. "I'm getting married in August and we wanted to have a house, (but) we'll have to live with my parents.'' Ruiz and his girlfriend make up a growing demographic of responsible professionals who want to buy but can't get over the 20% down payment hurdle. Mortgage industry newsletter publisher Guy Cecala offers this perspective, "You've never seen the mortgage industry this passive in lending in the past 50 years. They don't want any more missteps creating any more losses. The flip side is it's not helping anybody stay in homes or buy homes. You can't have a housing recovery without financing.''

The Daily Soak - July 15

What Happens In Vegas...Is Florida's Fault?

That's the general vibe oozing out of Sin City. It seems a growing number of plaintiffs are filing lawsuits against condo-hotel developers on the Strip, and this article blames Florida for being the condo-hotel trailblazer: "Industry observers trace the start of condo-hotels to Florida as a way to sell a surplus of beach condos. As such, it has had a longer time for buyers to grow unhappy with their deals." The project in question is the 1,728-unit, three-tower Signature at MGM Grand where the condo-hotel units sold several years ago in the $400,000 to $700,000 range. Plaintiffs claim they were deceived regarding the number of nights their units would be rented and the amount of income their units would generate. Instead of pointing the finger at Florida, the President of the National Association of Condo Hotel Owners (yes, NACHO) blames the prevailing mindset during the boom: "Condo-hotels are a lifestyle decision, a very cost-effective way to have a second home. Unfortunately too many buyers viewed them as an investment. And unfortunately, a lot of developers used that to their advantage."


Regardless of Market Size, HousingBath Impact The Same

When it comes to Florida foreclosure markets, Broward County tops the list; however, this article shows how the impact is identical in smaller markets like Polk County. Polk's 815 June foreclosures pales compared to Broward's 6,292, but the same patterns are emerging among the primary market participants. Prime borrowers are now starting to feel the pinch, credit counseling services are inundated with new clients, and brokers are both ramping-up short sale training for agents and handling a growing number of bulk property transactions. Keller Williams broker Chris McLaughlin shares his short-term strategy, "We're focused like a laser beam in getting people out of foreclosure right now," and his realistic, long-term outlook, "I personally think that because of the economic environment we're in, because of the job market, I think we're in this for the minimum next two years."


It's Time to Play "Name That MLS Listing Final Sales Price"

All real estate markets are local, and one new website is giving average Joes the platform for proving their local market expertise. ZipRealty.com's new website game, Price Me Now, lets visitors create a profile and try to predict the final sales price for active MLS listings in their backyards...or at least three backyards. Currently the game is limited to Boston, San Francisco and Seattle, but hopefully Florida metro versions are in the works. The game, developed by California-based Realius, has a slick user interface with multiple home photos, property descriptions and a sliding bid mechanism highly reminiscent of The Price Is Right's killer Range Game. Winning bidders receive IQ points for their predictions and high scores are updated on the homepage just like a classic arcade game. So colbs5 and cheze are officially on notice, be on the lookout for a new high score from hbath1.

The Daily Soak - July 14

Almost There: A Reliable Wall Street Source Finally Calls "Bottom"

The new issue of Barron's hit newsstands yesterday, and the cover story is a fine sorbet to cleanse the average Florida homeowner's palette after last week's Time Magazine hatchet job. In an exhaustive analysis, Barron's interviews a host of reliable sources including David Blitzer, chairman of the S&P Index Committee, and uncovers ample evidence the bottom is near. Barron's points to 40% sales growth in markets like Cape Coral, falling mortgage delinquency rates, and the $300 billion lifeline being thrown to Fannie Mae and Freddie Mac as cause for optimism. Barron's posits traditional media sources aren't reporting the news, because it doesn't sell nearly as many papers as the foreclosure doom-and-gloom scenarios. Economist Blitzer offers anecdotal evidence of that theory, "Other than Larry Kudlow of CNBC, none of the journalists who interviewed me after the latest release seemed at all interested in any of the positive developments."



7 Tips When You Absolutely, Positively Must Sell Your House

And for those homeowners who don't buy the Barron's argument, the Wall Street Journal offers a list of "Seven tips for homeowners who can't wait until the market turns around." Most of the recommendations are candid acknowledgements of the common enemies facing desperate homeowners: time (Don't Wait Around), excess inventory (Price It Cheaply), and buyer scarcity (Take The Offer). But the best advice (Promote! Promote! Promote!) encourages would-be sellers to not simply rely on their agent's bag of tricks to market the property. Flexing your creativity and tapping online resources like Trulia, Zillow and Cyberhomes can go a long way toward raising awareness and differentiating your home in an already-saturated marketplace.



What Will $225,000 Buy You These Days in Florida?

The St. Pete Times looks in their backyard to survey housing prices in the Tampa-St. Petersburg-Clearwater area, and asks how much house one can buy with $225,000. The answers ranged from a 665-square foot Clearwater condo with water access to a 1,000-square foot 1930s bungalow in Tampa to a more modern 1,800 square foot home in the suburbs near I-75. The Times reports that 2,500 square foot homes can be found in "glut-ridden, overbuilt Pasco County." A random search of Trulia lets us pose the same $225,000 question and troll for bargains in other Florida markets like Boca Raton (a 3/2 condo priced at $95/sf), Tallahassee (a 3/2 with hardwood floors and a big yard), and Jacksonville (a 2,100-square foot 3/2 home built in 1928).

The Daily Soak - July 13

Condo Association President Steals $760,000 from Residents

27-year-old Chris Winkelholz was just living the dream. Professional athlete? No. Rock star? No. South Florida Condo Association President? Awwww, yeah. And if there's one thing ladies love more than a soul patch, it's a man with the drive to become top dog of his HOA and the chutzpah to rob his 70-year-old neighbors blind. Pine Island Ridge Condominium residents like Pete Trampani want Winkelholz, who was apparently planning to hide in Argentina, behind bars for more than the 5 years he is expected to receive. When the Miami Herald broke this story last November, they reported that Winkelholz was "using a dead man's signature to deposit phony checks in a fake company's bank account." So Winkelholz was not only robbing from fixed-income retirees in his building, he was making the recently departed accessories from the grave. Understandably, Trampani and the other victims are lobbying for a sentence closer to the 70-year maximum; sentencing will be held next month.


New Legal Resources, Services Available to Florida Sellers

Two new programs were launched this week to aid Florida homeowners either on the brink of foreclosure or just needing a professional legal opinion. FLASH, or Florida Attorneys Saving Homes, is a toll-free hotline geared toward helping Florida homeowners "who are not in foreclosure, but fear the possibility." The hotline is staffed by Florida pro bono attorneys and can be reached at 1-866-607-2187. The second program launched earlier this week is not free, but it does offer Florida homeowners "an opportunity to purchase prepaid legal services for their real estate deals at below-market prices." FSBO.com unveiled this program in Florida and is currently offering three packages for sellers who need a legal consultation ($169), a sale contract review ($299), or both ($369).



When Normal Growth Feels Abnormal & The Ominous "EOF"

Mark Lane's witty editorial response to the Time Magazine below-the-belt piece, "Is Florida the Sunset State?" Lane contrasts the hyper-growth Florida experienced in recent years with our current 1.1 growth rate which, he points out, is still higher than the national average. Lane's spin on the Time article mirrors that of HB.com: It was apocalyptic sensationalism from a magazine that once predicted "the Coming Ice Age." According to Lane, Time's "End of Florida" piece ("EOF") listed every possible Sunshine State negative except "highway gridlock, increasing homicide rates, and grouper overfishing." Lane puts the status quo in perspective, "We're hung-over from what turned out to be a real estate boom of historic proportions. At the time, a lot of people here thought it was the New Normal. Instead it was party time and a lot of us mistook it for regular life."