Florida and Texas homeowners face mortgage problems.

Due to rising interest rates and property taxes, states like Florida and Texas have been experiencing an increase in the number of homeowners struggling with their mortgage payments, which has pushed many toward foreclosure or selling their property.

And although foreclosures are generally the result of factors like unemployment and falling home prices, this is not what is currently affecting the market in these states.

In Houston, for example, foreclosures have increased by 37%. Meanwhile, the Dallas-Fort Worth-Arlington area in Texas has also seen a rise. The same situation is happening in the cities of Orlando, Tampa, and Miami.

These developments are contrary to the current U.S. real estate market, where foreclosures are decreasing. One reason for this, according to experts, is that many of the affected homes were purchased recently, and due to rising rates, their owners are unable to make timely mortgage payments, and the current value of their homes is not enough to sell and pay off the loan. Therefore, selling the properties to settle the loans is becoming increasingly difficult in these states.

According to a recent study by Zillow, a real estate company, the most attractive cities for property investors and buyers are located in Florida and Texas, highlighting cities like Jacksonville, Orlando, Tampa, Houston, Austin, and San Antonio.

Zillow also reported that the appeal of these two states increases when considering that, among the 50 largest metropolitan areas in the country, these two states currently favor sellers, who have a larger inventory of homes available than other areas. And although the index is more favorable to buyers, it still leans toward sellers.

The company designed its index based on the percentage of homes that go pending for sale within three weeks or less, those that experience a price reduction, and those that are active listings with the company.

In Florida and Texas, potential buyers face less competition than at the start of the pandemic, as “strong construction in many of these markets has helped restore inventory levels.” “Tampa, Orlando, and Jacksonville have some of the smallest deficits, while Austin and San Antonio are two of the three markets with the most inventory today,” the report states.

The increase in inventory means that three of the four “buyer’s markets” are in Florida. Among the seven neutral markets, another is in Florida, while three more are in Texas. The remaining 39 are seller’s or strong seller’s markets, according to Zillow.

Available foreclosures:

Houston: 1,200

Orlando: 950

Tampa: 1,100

Miami: 1,050

Dallas-Fort Worth-Arlington: 1,300.

By Elias DaSilva | September 18, 2024.