Foreclosure Filings Starting To Level Off August 3, 2008 - 4:36PM Thomas J. Monigan - Daily News July's preliminary figures are in, and for what appears to be the first time in several years, foreclosure filings are no longer going up, up, up. Filing of the form known as "lis pendens" signals the start of the foreclosure process. Since May in Okaloosa, Santa Rosa and Walton counties, those filings have begun to taper off slightly. Okaloosa is down 14 percent and Walton has dipped 13 percent, while Santa Rosa is up just 4 percent. News of this development was met cautiously in local banking and real estate circles, where local executives have been speaking recently of "bumping along the bottom." "It seems to be some stabilization and the beginning of an improvement," said Bob Bennett of First City Bank. "Hopefully, we're getting that traction and we can start on the upward slope. ... But there are so many different factors at work with the national economy." Gloriad Frazier, owner and broker of ERA American Realty of Northwest Florida, offered two theories on what the recent numbers indicate. "Hopefully, this does mean we're coming out of this slump and the bottom is here, or almost here," Frazier said. "Second, there could be more short sales that are going through. ... But either way ... I think it's a reason to be cautiously optimistic about the future." Short sales involve the bank or mortgage company forgiving a certain amount of debt and allowing the house to be sold for less than its original price. When that process began in recent years, the theory worked better than the practice, which turned out to be complicated and often dragged on for months. "A year ago, the lenders didn't have the process down as well as they do today," said Carmella Bell of ResortQuest's real estate division. "It's more streamlined now and they have procedures to follow. That could have a lot to do with stabilization of lis pendens. ... Hopefully, people who are upside down in their mortgages are not waiting to ask for help ... and lenders are better prepared." Even people who are not financially troubled and are trying to sell a home have come

to dread the words "too much inventory" when it comes to what's on the market. Data from the Emerald Coast Association of Realtors' Multiple Listing Service reflects a slight decline in inventory from January through July in Okaloosa, Santa Rosa and Walton counties. In Okaloosa, there were 1,394 fewer homes on the market during the first seven months of this year than the same period in 2007. In Santa Rosa, that number was 364 fewer. In Walton, the number was down by 1,066. "It is also encouraging to note the average inventory of the three counties combined has decreased approximately 12 percent from 2007 to 2008," Bell wrote in an e-mail. "Albeit slight, this reduction in the inventory shows signs of a stabilizing market." As the housing bubble grew in the early part of this decade, prices reached levels that previously were unimagined. But the aftermath of the bubble bursting appears to have introduced sellers to reality. "Many have reduced their price to a more reasonable listing, hoping to meet market demand," Bell wrote in her e-mail. "Or, if the market isn't demanding the price they want, some have decided to withdraw their property from the market and hold it for a while." Brian Robinson of ResortQuest's mortgage division agreed. "It's still a buyer's market, because more realistic pricing is where it needs to be," Robinson said. "You won't see a lot of 100-percent financing. People need that 10 percent or 20 percent down to get more skin in the game. That's reality. And I'm also hearing from people who have been vacationing in condos here for years who can finally afford to buy where they've been renting." Mike Roche of Northstar Mortgage Group had a similar take. "Have we come to a bottom? Are we starting to move or whatever? Nobody's got that crystal ball," Roche said. "But we're getting more applications for loans and that's a very good sign. Now's the time to buy when there's inventory out there and rates are still low (below 7 percent). So many buyers were screaming two years ago, ‘It's a seller's market.' Well, it's our time now." Daily News Business Editor Thomas J. Monigan can be reached at 863-1111, Ext. 1438.