Today, some people are in favor of renting, rather than buying. The Brevard County Florida housing bubble is creating new risks for some tenants. In addition to some other areas of the country. Many houses and condos are available for lease. Owners are forced to rent them out. They haven’t been able to sell them for the peak prices they paid in 2005.
Landlords are renting at a deficit. They are paying more in monthly mortgage payments, taxes, insurance & association fees than they are receiving in rent. Their sentiment…some money is better than no money. But, how long can they continue to pay out? Often times, for a very short period of time. Then, tenants are losing their homes. They are paying their rent. But, landlords are unable to keep up with the mortgage payments. So, tenants are being forced to move because of the owner's foreclosure, without being legally evicted! Tenants are losing their security deposits, and their last month's rent. And, most have no recourse! It’s happening everywhere!
Here in Brevard, we get nearly 2-3 calls a week, from tenants telling us that they are being forced out. Often times these people don't have the funds saved up to move to another property.
I have heard of many landlords that are currently collecting the rent money from their tenants, and pocketing it. I have heard owners say, "It's going into foreclosure anyway, why waste the money? "
Being a landlord myself (a willing one) I am baffled by the mentality.
Many owners never planned on being a landlord. They bought houses hoping to “flip” quickly at a profit. Some bought under normal circumstances. But, now they must sell and can’t, because the market took a downward turn, and we are experiencing a market correction.
In 2006, nearly 50,000 non homesteaded property owners did not pay their tax bills in Miami-Dade and Broward County, creating additional problems.
So, if you are a prospective tenant or know prospective tenants, be sure you ask questions of your prospective landlord. Check county records to see if a property you are considering is going into foreclosure. Do your homework before renting from anyone!
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Even doing that won't solve the problem as the owner may go into foreclosure at any time. We live in uncertain times. Best solution is to save up and have a reserve just in case.
Sandy, what is scary is when you see a house listed for sale and for rent, and the sale is "subject to a potential short sale".
Sandy - there are a lot of landlords caught in the squeeze of their tenants not paying and are facing foreclosure; these days you can lose 4-6 months worth of payments, then rehab costs when you evict.
Hi Rich, Well I agree with you and we are seeing alot of that here, enough 7 months after I wrote this post. Thanks for taking the time to go back and read one of my older posts. I have heard of landlords that are pocketing the rent money as they know they are going into foreclosure! It's awful!
Hi Bobby, Yes, I would have to agree, that tenants not paying today has become a large concern also. There's no question about it. But, here in Melbourne Florida I have been able to get a non paying tenant out within 30 days. However this is provided that I don't request a court hearing for the late rent lost. Typically, all you get is a court judgement. In my opinion, if they can't pay their rent to keep the roof over their head, then why would they pay you for a judgment later? My 30 day eviction is also provided that the tenant doesn't file an objection to the eviction and request a hearing. If either of these 2 things happen then it usually extends the eviction an additional month.