Many owe more than property is worth

A decade after a collapse in the housing market triggered the Great Recession, South Florida still has many homeowners who owe far more money than their property is worth.

And even with home prices creeping up in recent years, Broward County is ground zero for underwater mortgages.

As of the second quarter of 2018, about 8 percent of Broward’s homes were “seriously underwater,” according to California-based Attom Data Solutions, a real estate research and analysis firm. That compares with 5 percent for Palm Beach County and 4 percent for MiamiDade.

Attom defines “seriously underwater” as properties where mortages and loans exceed the home’s estimated market value by at least 25 percent.

South Florida fared better than the U.S. average. One in 10 homes across the United States was seriously underwater this spring, Attom reported.

Daren Blomquist, senior vice president for the company, said home sales prices in South Florida remain 10 percent to 15 percent below their peak in 2006. “That’s kind of the number one factor” that leaves homeowners owing more than the property may be worth, he said.

Blomquist said Broward’s high proportion of underwater homes, relative to neighboring counties, could be because many homeowners who bought before the recession stuck it out rather than go into foreclosure, meaning they still owe more than what they can fetch on the market. But they still have the house.

“High foreclosure rates are kind of like the reset button,” he said.