More examples of Countrywide’s multiplier effect…
Each time I look at this site, which tracks foreclosures at Countrywide Financial (CFC), I become even more convinced that Bank of America (BAC) still doesn’t get the full extent of the problem it will soon inherit, no matter how many times Ken Lewis says otherwise. As the deal moves ever closer, the number of homes that Countrywide owns in Florida has now climbed above 1,600 and the prices, despite being slashed repeatedly, continue to fall.
Take this house at 27 Sevilla Ave. in ritzy Coral Gables. According to Miami-Dade property records, the two-bedroom house was bought for $570K in May 2006. When Countrywide foreclosed on the property — it’s not clear exactly when that was from the records I’ve seen — it was listed at $663K. But it hasn’t moved and the price has dropped to $305.9K. A quick scan of some of the other 1,604 properties that Countrywide owns in Florida shows equally sharp declines: a house in Orlando that was originally listed at $294K is now listed at $89K, a condo in Palm Beach Gardens that originally listed at $619K is now listed at $242K, and a home once listed at $755K in Sarasota is now listed at $184K. Because these are individual loans and there’s literally thousands of them across the country and because doing the homework requires a significant amount of work and digging through records, it’s fair to assume that Bank of America is using some sort of model to predict losses on Countrywide’s entire portfolio.
Oh — and it’s not just Florida. This home in Antelope, Ca. is now listed at $213K, down from $1.29 million $430K when Countrywide took it back in foreclosure. Judging by all of the other houses in the area, the $213 may still be ambitious. (Note from Michelle: see comments below for explanation on why the $1.29 million was incorrect)
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June 17th, 2008 at 12:41 pm
The $1.29 million original price shown for the Antelope, CA house is most likely a typo. It’s identical to the pre-foreclosure price of the Anaheim Hills house right above it on the list, and if you look at the prior sale history in Trulia, you see that the Antelope house sold for $430,000 in 2006.
I am just noting that; I certainly don’t dispute the overall point of your post.
June 17th, 2008 at 12:46 pm
Do we know for sure that Countrywide is the owner of these houses? I thought it was possible that they’re just servicing the portfolio and perhaps there were other lenders involved?
June 17th, 2008 at 2:48 pm
Gab: I don’t know for sure that Countrywide owns the houses. All I know is that they’re listed on Countrywide’s REO site, so presumably if they were owned by someone else they wouldn’t be listed there. Looking at the house at 27 Sevilla, though, Citibank is listed as the owner. I guess the bottom line is that making sense of who owns what is pretty tricky. A quick search of Miami Dade records shows that various units of Countrywide are listed as the owners for 109 properties in that county.
As for the house in Antelope, I agree that it does seem like a typo, based on the Zillow records. I struck out when I tried to find the sales history in the Sacramento County records.
June 18th, 2008 at 5:01 am
It was a small bug on my part (I had forgotten to do one step). Good thing I read the comments on this post and noticed the error. All the listings have now been updated. It appears that the Antelope house was recently added on Countrywide’s reo list. SeanDC is correct, and according to Trulia that house sold for $430k in 2006. That’s still a 50% drop in price and not something to be too happy about if you bought it in 2006.
June 29th, 2008 at 12:36 pm
I think a lot of banks are in denial. I don’t know the terms of the deal, but is there anyway that Bank of America can back out at this point.