In Florida’s Cape Coral area, real estate broker Marc Joseph has been holding boat tours to show foreclosed homes to potential homebuyers and investors. The city, located in Lee County, has more than 400 miles of passable waterways and has longer canals than any other city in the world.
Joseph’s novel marketing strategy for his company Foreclosures ‘R Us called Foreclosure Boat Tour involves inviting potential homebuyers to his company’s boat, presenting them with attractive statistics on prices of foreclosed homes and then bringing them to several foreclosure properties along the city’s canals.
In RealtyTrac’s foreclosure report for 2008, the Fort Myers-Cape Coral area had the highest foreclosure rate in the country. With 12.03 percent of homes receiving foreclosure notices in 2008, its foreclosure rate is six times the average nationwide foreclosure rate and twice the foreclosure rate of Florida. Florida, meanwhile, had the second highest foreclosure rate in 2008, next to first placer Nevada.
Joseph starts his sales presentation by telling his potential customers that the low prices of residential properties in good locations in Cape Coral indicate it is time to buy a house. He says that many foreclosed homes available are priced much below their building costs. With about 34,000 foreclosed homes in the Lee County-Cape Coral area, banks have been dropping their prices just to be able to sell and reduce their losses.
The Loepkers are among the clients on Joseph’s boat. They are corn growers in Illinois seeking to buy one among the foreclosed homes for their vacations in Florida during the winter. Among the houses they were viewing was one property previously bought by the homeowner for $725,000, and now it is being sold for only $279,000, an astounding 61 percent drop.
As Joseph and his clients toured the other foreclosed homes for sale, he showed his charts illustrating how home sales are approaching sales levels during the real estate boom in 2005, but at prices about half of their 2005 price levels. Joseph also uses a foreclosure bus to bring his clients to foreclosed homes not along the waterways. He showed a 1,400-square-foot home sold in 2006 for $256,000, which was immediately sold for only $54,900.
Joseph projected that the buyer’s market will last for a couple of years, until most unsold foreclosed homes and abandoned houses are sold. What Joseph is most concerned about is the return of speculators in droves and their continued dominance of the housing market, which they previously destroyed with their defaults.
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