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)