The United States of America, being a confederation of states, has different rules for each state. Therefore, each states has to undergo a series of common federal standards. With Real Estate, many legal and tax situations may differ from state to state. Here we will deal with only the State of Florida.

Real Estate includes, any market dynamics related to real estate such as: a small single family in the suburbs, commercial and industrial buildings, or a skyscraper in the heart of the metropolis. Needless to say, to summarize in a few lines, variables such as a vast work of synthesis. It is essential to know how to correctly interpret market trends to draw conclusions before buying a property. Hence, it is necessary to turn to professionals for adequate analysis. For the success of a real estate transaction, consider the  the dynamics below that will help in the choosing of the type of property you want:

1) The purchase price, as a primary factor in determining the success of the enterprise.

2) A need to consider the aspects of the surrounding area with regard to employment; is it a high employment area with real economic growth? Does the area excel with favorable financial institutions having high standard policies?

And, finally, are there satisfying government and economic social policies?

We will help you answer all these questions and more!



Median Sales Prices


St Petersburg







Median Sales Prices










Median Sales Prices











The Premises

Let’s examine the events of recent years to understand where we are today.

We are all aware of the consequences of the housing bubble tied to subprime mortgages: economic expansion has entered a strong liquidity in the market, which has led to a rapid expansion of financial products in the form of investments (stock market and derivatives, real estate) and consumption of goods. However, for others there has been no such accompaniment of adequate real growth of the economy.

At a time, when the growth of the real economy was no longer able to sustain the financial fallout, we saw the first cases of insolvency: the financial suffering was then gradually transferred by the owners to insolvent banks. Having reached their saturation point within the system, the financial institutions generated a strong reduction of liquidity and implemented stricter criteria and restrictive access to credit. This reduced the demand for real estate and led to the subsequent decline in prices. Thus, the value of the property was far below expectations and no longer exceeded the value of the debt. At this point the owners no longer had any interest in honoring debts disproportionate to the actual value of the property.

However, in Europe, thanks to containment measures and subsidies, there was a greater resilience in prices with the consequent phenomenon of stagnation, due to the sharp drop in the number of transactions.  However, in the United States where the market is more responsive and dynamic, the properties have undergone a drastic fall in prices, some, well below the index of construction leaving it to cost less than the equivalent in commodities.

Since late autumn 2011 after the real estate trend hit bottom, there has been a resurgence in the US real estate market and the result is continuing price increases and a recovery in real estate value.



The Process of Expropriation: Foreclosure Auction and Market Consequences

From the summer of 2006, the banks found themselves facing a growing amount of delinquencies. How did they react? What were and still are the consequences?

In Florida, whenever a credit institution incurs an insolvent owner for more than 90 days, they have to apply to the court for the recovery procedure of the remaining credit or part of it i.e. default notice and forced expropriation of the property. The court, after hearing the parties and attending to the various injunctions, will proceed to forced the sale of the property publicly.

In cases where the rod goes empty for lack of interest or failure to achieve the minimum starting price, the property becomes Real Estate Property Owned (REPO or REO) because the bank becomes the legal owner and is legally responsible for the property.  Thus, the bank is required to perform maintenance, security of the property and fulfillment of tax obligations.

Secondly, the lender will seek to obtain the original claim addressing a broader market by first, seeking possible customers via sales office and then releasing the property on MLS portals through brokers. Commonly, this form of sale is wrongly defined as a “Foreclosure.”  In effect, it is a private transaction between the bank and the buyer in all respects; the more appropriate term is Real Estate Owned Property REPO or REO. The real “Foreclosure” is the seizure itself. The action of forced expropriation of property by the court through judicial auction is the real process of “Foreclosure.”

It goes without saying that a surplus of inventory “perishable” and expensive to maintain, becomes a liability in the financial statements. At this point, the property is made available to a market of potential buyers through advertising campaigns, with the objective to sell and recover a maximum for credit.

When the property hits the wider market, it has accumulated costs. At this point, it is unlikely that the property can be put on the market at a price equal or lower compared to the preliminary auction. Usually this may happen, due to maintenance costs or the security of the property becoming too expensive due to: fire damage, water damage or other structural failures and plants and pipelines need to be redone.



The Multiple Listing System

The United States, for years now, has been able to arrange housing supply through an extensive platform: the Multiple Listing System (MLS), from which many buyers and investors draw. The MLS is a common electronic database, where realtors publish and track their properties available in the market. It is a very practical and effective tool that reaches all and precisely because of this accessibility to any competitor, in truth, a bit inflated.

Whereas the real deal is characterized primarily by a strong economic advantage during the purchase, it is more advantageous to explore the theme of judicial auctions that allow  you to operate upstream of Real Estate Property Owned (REPO/REO) wrongly defined “Foreclosures” and commonly found on the market through portals MLS.




From 2012,m the political action of the government through targeted initiatives and incentives, focused to return value to real estate in order to stop delinquencies (soft loans) and to simplify procedures for the recovery of credit with incentives to the banking system, linking of internal budgets favoring banks that provided more mortgages and less release of properties to the market.

Real Estate offers a wide range of options to acquire a property and since many real estate crashes were prevalent, let’s see some options in detail.

Short Sale

A “Short Sale” is an agreement between the parties in order to allow the owner to sell the property at a price lower than the agreed residual debt and closer to the current market.

After the collapse of a real estate property, sometimes the banks prefer to accept a lower balance due rather than face a long time waiting for a forced recovery of credit or a build up of debt and high legal costs. In this case, the owner, not insolvent, must indicate to the bank a number of reasons for a “Short Sale.” It is not enough to simply claim economic difficulty. It must be replaced by a substantial change in your existing circumstances caused by exceptional events such as: job loss, medical/health reasons, etc. Negotiations are direct and involve the bank. The process is complex, often refused and exposed to defects of form or procedural impropriety.

The “Short sale” can take a very long time. A period of 9-12 months before meeting the approval, which in some cases can be rejected.  This might be due to the value of the property increasing during this time and the offer is more than adequate to market parameters.


When the owner is insolvent for more than 90 days (three consecutive installments of the loan), the bank declares him in default and begins the process of forced recovery of the claim through the courts. Until the date of expropriation, the owner has the option to pay off the remaining debt or sell the property to weld it. The negotiations for the purchase of the property can be exhausting and the property is sold in “as is condition”. If the offer on the property is less than the balance due, the bank has the last word.  It can decide to recover part of the credit right away, explore a greater recovery for auction or take possession of the property. Also, it might be that the owner has no intention of leaving the building (or has no alternative housing) and will be submitted to an Executive Eviction Procedure once the transfer to ownership has taken place. This can take a long time, especially when it comes to families with children.


The instrument through which the forced expropriation is acquired is an “Auction.” The property is auctioned to the highest bidder and the bank itself can participate. In doing so, the bank is allowed to define the minimum base bid, which is not necessarily made public. In the event that the auction minimum is not reached, the lender that has promoted the expropriation holds the title to the property.

Buying directly from the court involves a very high economic advantage to you. You can buy the property at a price 50% to 80% lower than the average market estimate. Of course, not all of this is profits due to the costs of restructuring, maintenance, settlement and ownership, etc.

Competing offers are transparent, public and accessible in real time. The title of the property is transferred, recorded and released in a few days.

However, there is a definite need for expertise in the field due to the title search. The buyer shall bear the cost of eventual outstanding debts, mortgages and liens.

The property cannot be internally inspected prior to the auction and is sold in “as is condition”.  It takes so much experience and professionalism in order to assess the conditions outside of the property and also to estimate the rehab to be performed. This can be achieved with a good approximation only to an experienced eye.

Real estate auctions, with the right approach, tend to give a greater satisfaction in a much shorter time than all other forms of acquisition of the property.  This is due to the fact that the negotiations take place in real time and in a transparent fashion  between a private party and judicial institution. However this solution is the most risky one, as every investor should know, more gain, more risk!

REPO (“Foreclosure”)

Real Estate Property Owned

When a property is not a judicial auction property it becomes Real Estate Property Owned or REO/REPO i.e. it is held by the bank that holds its mortgage. Usually these properties are put on the market by other channels such as: sales offices, brokers, direct negotiations (packages of properties) and the Multiple Listing System (MLS). In the case of multiple offers, the bank communicates the number of tenders received, but not the amount. The buyer(s) are bidding against many offers. This is very inconvenient for the buyer(s) because a counter-offer is needed. However, there is no guarantee that what is counter-offered will secure the property.

The property is sold in “as is condition”, but you get a period of time wherein you can inspect the property. If the conditions were particularly bad, you can withdraw the offer. However, in recent years, it is no longer possible to turn down the offer once accepted. Normally, the price at which the property is placed on the market, is higher than the highest bid obtained in the auction proceedings. This is due to the need to cover the costs of maintenance that the property incurred by the banking institution before it was sold.

The allocation of the property by the court to the bank and then to its placement on the market, may take several months, depending  on the institution of credit. You also need to take in consideration the domestic budget and projections of market growth. During this time, the property has incurred legal costs, management fees, taxes and sometimes past debts (mortgages of various kinds), that could affect the financial statements of the bank.  There will definitely be a reduction in the price compared to the previous auction. Therefore, in this market it is timely to expedite the process in order to secure the value of the property.