Beachfront homes that were once unaffordable have now opened up due to foreclosure. Now, attractive properties are available in Florida and California.
Usually beach side properties hold their value even during downturns. But this time prices in places such as Florida, California, Texas and other beach-front properties have dwindled.
"It's a good time to buy foreclosures in beachfront communities, because prices are so low in many locations compared to where they've been in the past," Daren Blomquist, vice-president, RealtyTrac, which recently compiled a list of ‘Best Beach Towns for Foreclosure Bargains’, told The Street.
RealtyTrac, a website that offers foreclosure information, first listed the top 10 U.S. beach towns and then analysed foreclosure sales data to identify popular beach towns with the biggest discounts on foreclosure purchases in the first quarter of 2012.
With an average foreclosure discount of 45.11 percent, Sebastian-Vero Beach, Florida, emerged the best beach town for foreclosure bargains. The average sale price was $93,188.
Barry Segal, a Vero Beach attorney said it was no surprise Vero Beach topped the list, Tcpalm.com reported.
"There are plenty of bargains going right now. There are plenty of aggressive banks trying to unload their properties, and they're also being very forthcoming with short sales,” he said. “(However) none of that changes the allure of Vero Beach."
Corpus Christi, Texas, and Naples-Marco Island, Florida, follow closely with an average foreclosure discount of 44.38 percent and 40.43 percent, respectively.
The main reason why beachfront homes fell into foreclosure, Blomquist told the Street, was because homeowners decided to stop paying mortgage bills as the value of properties dropped below the loan’s unpaid balance.
However, Blomquist advices caution before investing in a beach side property as he feels many homes fall into despair before being seized by the bank.
"You don't want to buy a beachfront foreclosure sight unseen -- a mistake many investors make," Blomquist said. "Even though the property might be far from your home, you want to either go there yourself or have someone you trust check it out before you buy."
Top 10 beach towns for foreclosure bargains:
Sebastian-Vero Beach, FL
Corpus Christi, TX
Naples-Marco Island, FL
Santa Barbara, CA
Charleston, SC
Hilton Head Island, SC
Atlantic City, NJ
Honolulu, HI
Barnstable, MA
Santa Cruz, CA
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