MIAMI (AFP) — South Florida foreclosure expert Rhona Light says she is busier these days than she has been in years.
Two decades ago, when Light began collecting foreclosure data and publishing it for perspective buyers, she said there were about 50 cases a week in Broward County, home to her Hollywood, Florida, office.
These days, in Broward alone, there are a reported 1,200 home foreclosures a week. "Foreclosures have gone through the roof lately", said Light, forecasting even darker days ahead.
Until a couple years ago, Broward County, home to 1.8 million people, and its neighbor Miami-Dade were considered among the country's choice locales for real estate investors looking to turn a quick profit on new condos.
But when the American housing bubble burst, the effect, coupled with rising mortgage payments on adjustable rate loans, left a trail of devastation.
Perhaps nowhere in the United States are the ongoing mortgage and credit crises more apparent than in South Florida, where real estate prices are falling and more than 11,000 people filed for bankruptcy in 2007.
Experts like Light expect even more owners to turn to foreclosure and bankruptcy to ameliorate their financial woes.
"It's only going to get worse", Light surmised, expecting foreclosures could reach 2,000 a week in Broward in 2008.
The recent glut of foreclosures has also forced Miami-Dade and Broward counties to add a third day to its weekly calendar of foreclosure auctions, she noted.
And while the number of personal bankruptcies for 2007 pales in comparison to the 36,000 recorded in 2005 -- a number attributed in large part to changes in to the state's bankruptcy laws making it harder to file -- some speculate a continuing sluggish economy could give the record a run for its money.
However, one man's money woes are another's windfall.
Last year Light began teaching classes in foreclosure property investment and now boasts 20 students per session.
Both here in South Florida and in other real-estate distressed areas, foreclosure bus tours are carting bargain-hunting investors to dozens of properties in a day.
And amid the dramatic downturn of fortunes for South Florida real estate owners, the region's bankruptcy lawyers are also busier than they have been in more than a decade.
"This is the busiest we've ever been and it's probably going to get even busier", said Matthew Militzok, a partner in the Miami law firm of Militzok & Levy.
Militzok, who has been practicing bankruptcy law for more than eight years, said over the last six months his roster of clients has grown to the point where his firm is filing up to two or three new cases a day.
"People here spent a lot of money they didn't have", he said, referring to the once widely popular "property-flipping" scheme that has left regional real estate speculators holding parcels they can no longer sell. Under the scheme people would buy cheap properties, do them up, and then try to sell them for an inflated profit.
Meanwhile, the worst effect of the real estate downturn and rising foreclosure rate has yet to be felt, said Joel Aresty, a fellow Miami bankruptcy lawyer doing a pretty brisk business in his own right.
Aresty predicted the South Florida housing surplus and economic slowdown will force more developers to place building projects on hold, potentially putting thousands of construction workers and contractors out of work.
"Pretty soon the whole food chain is going to be affected", he said.
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