The Affect of the Next $350 Billion Bailout for Daytona Beach Real Estate

Yesterday, the $350 billion in bailout or TARP funds were release by Congress. The release came in response to requests from the incoming Obama administration to help the national economy.

Part of the conditions of the second release is that financial institutions receiving funds work with home owners on mortgage modification or mitigation to help them stay in their homes.  Up to $100 billion of the $350 billion is targeted to individual home owners.

So What?

We have been advocating for mortgage mitigation as a necessity to the rebound of the Daytona Beach real estate market. Why?

1. There are too many homes on the market
2. More foreclosures are immanent unless action is taken
3. Too many homes drive down prices
4. Banks dumping properties through foreclosure and short sales drive down prices

Mortgage mitigation should help all four of the factor listed above. There are over 5700 Daytona Beach homes and condos listed for sale in the MLS as of this morning.  We sold less than 3,000 homes and condos last year. That’s not a pretty picture. Foreclosures and short sales will continue at a high rate until 2010-2011 unless more people can stay in their current homes.

Yes, it’s a hard pill to follow for those who continue making their payments. Helping people who many consider “irrepsponbile” angers many. I’m not going to take sides, but merely say, unless something changes, prices will continue to fall and more homes will become distressed properties. This action should help all home owners if prices stop falling and homes go off the market.