The Miami Herald reports from Florida. "The top job-loss state in the nation. Shrinking wages. Collapsing population growth. Record home foreclosures. Florida's economy is not just firmly and bleakly in the red, it will likely stay that way until next June, according to the state government's top economists. At the heart of the problem is the falling housing market, upon which Florida's economy has a Monopoly game-like reliance. The economists projected new housing construction will fall to about 60,000 units this year, a decrease of 78 percent from a high of nearly 283,000 in 2005."

"Florida lost more jobs in the past 12 months -- 74,700 -- than any other state in the nation. And the economists predict that more people in construction, government, manufacturing, financial services, transportation and warehousing will be out of work soon."

"'We were No. 1 in jobs created in the entire country,' said Clyde Diao, one of Gov. Charlie Crist's economists, referring to the booming economy in 2005. 'Now, if you count the District of Columbia, we're 51. What is important is jobs. If you don't have a job, you can't buy a house.'"

"In unusually plainspoken terms, the experts struggled with the data to figure out just when the state can wrest itself from a vicious cycle in which the lagging housing market triggers job losses that, in turn, worsen market conditions. They cut the their population-growth estimate for the state by nearly 100,000 from 300,000 over the next three years."

"And the state has a surplus of housing units, especially in Miami-Dade, and Florida was No. 2 in foreclosures in the nation last month behind California. The combination -- fewer home buyers and more foreclosures -- will only increase the surplus housing stock and decrease the need for so-called 'starts' in new construction, said Alan Johansen, the Senate's chief economist."

"'What's going to support the starts when there's nobody here to buy them?' he asked."

"As foreclosures continue to mount, borrowers who have run out of options are turning to attorneys to fight back, and they're living mortgage-free for months in the process. Although the chances of ultimately keeping a foreclosed home are slim, for $1,500 to $3,000 some lawyers are offering to defend borrowers in court, causing the wheels of justice to turn more slowly."

"One way is forcing the lender to prove it owns the debt behind the mortgage by producing a promissory note. As mortgages were bought, bundled and sold off to investors, notes got lost in the shuffle, landing in vaults or warehouses around the country. Physically retrieving them can be difficult and sometimes impossible."

"When lenders can't prove they own the loan, lawyers can get cases dismissed, said Peter Ticktin of the Ticktin Law Group in Deerfield Beach, whose firm has advertised foreclosure defense services on television. He began taking foreclosure clients about eight months ago. So far, none of his cases have gone to trial. His clients are still in their homes."

"'People think I am dealing with a bunch of con artists,' Ticktin said. 'I'm talking about families, innocent kids, people who got led into deals that are causing them trouble.'"

"Angela Bellsanctious, of Lauderhill, admits she is careless about opening her mail and said her mortgage was bought by a new servicer without her knowledge. Because her payments were automatically withdrawn from her bank account, she didn't know her loan wasn't being paid until it was too late. On June 12, the home she had lived in since 1990 was sold. Last week she got notice from the Broward sheriff that she had 48 hours to move."

"'I was freaking out. I was praying and praying, and this lawyer came on the TV and said something about foreclosures,' Bellsanctious said."

"It was Ticktin, who for $360 got a judge to waive the writ of possession while he tries to sort out the problem with the lender. 'I have no idea where I would have gone,' Bellsanctious said."

"Yet, for every legitimate miscommunication and misconduct by a mortgage lender, dozens of bogus defenses are filed, clogging up the courts, some lawyers said. Iris Hernandez, a lawyer who files foreclosures on behalf of lenders, said some local attorneys were known for filing boilerplate defenses without supporting their positions, acting for borrowers seeking to take advantage of the system."

"'Some people feel that 'If I don't pay for a year, I'm getting my down payment back,' Hernandez said."

"Marc Ben-Ezra, who also files foreclosures statewide for lenders, said the borrower who seeks to delay the inevitable can face consequences. Interest rates and other costs continue to pile up as the process drags on. Plus, homeowner and condo fees aren't being paid, which places hardships on people who are paying their debts."

"'With every single day that goes by, they could be helping their clients get into bigger and bigger debt, rather than if they face the problems head on and resolve them as quickly as possible,' Ben-Ezra said."

From TC Palm. "A multi-million dollar auction at Tesoro in St. Lucie West proved homes across Florida won't sell until homeowners face reality: They won't get top dollar for their homes. The reserve auction, which allows sellers to accept or decline the highest bid, was a bust. Not one property sold to any of the 150 people in attendance on June 28."

"The first and highest bid that was declined came in at $1.2 million for a four-bedroom, five-bath, furnished home that lists for $3.75 million. After the first bid of $450,000 on the second house was declined, the remaining properties were removed from the auction block."

"'Until sellers readjust their asking price, there will continue to be an overhang of properties in Florida,' said Jose Boza, spokesman for J.P. King Auction Co., which hosted the auction and promoted it in a national campaign."

"Reserve auctions aren't working in today's market and they're wasting the sellers' money, said Daniel Decaro, president and broker of Daniel Decaro Real Estate Auctions Inc., which handles a large percentage of Florida's auctions. His firm auctioned Vero Beach luxury homes in April. 'Sellers are in denial when it comes to the market,' he said."

From Local 6. "The Orlando housing market is beginning to stabilize, but it's not improving quickly enough for people who have a house that has to sell now. The Local 6 report featured a three-bedroom, two-bath home in Orlando's Almond Tree subdivision."

"When the Howe family put its home on the market, it listed it at $425,000. The family's Realtor, Art Kent, told them the price needed to come down -- even though homes in the same neighborhood were selling for mid-$400,000 and even low $500,000 prices a few years ago."

"'What their home was worth when they bought it doesn't matter and what their home was worth two years ago doesn't matter,' Kent said."

"And price alone is not the only consideration. 'It's a price war, and it's a beauty contest,' Kent said."

The Herald Tribune. "The region's economic downturn is not paying attention to social status and is starting to take down commercial and residential developers alike. The latest casualty is Mark Ogles, a Manatee County commercial real estate developer who led Southwest Florida's legislative delegation in Florida's House of Representatives in the 1990s."

"Since March, Ogles has defaulted on five loans totaling $2.24 million. Ogles says he is not ashamed of his debts. A recent divorce from his wife of 20 years that stripped him of more than half his net worth and the worsening global credit crunch made it impossible for him to come up with the capital necessary to stay afloat."

"'I was in, like, 10 projects,' Ogles said. 'I couldn't get construction loans, and a year ago, I started going under.'"

"Former Florida Senate President John McKay defaulted on a $4.135 million loan in April after being unable to bring a 288-unit Lakewood Ranch apartment complex out of the ground. Even U.S. Rep. Vern Buchanan, one of the wealthiest members of Congress, has had to sell real estate at a loss. In November 2006, Buchanan sold a condominium at the Residences at the Ritz-Carlton in Sarasota for $300,000 less than he paid nearly two years earlier. Buchanan has since listed a waterfront house near Sarasota's Stickney Point Bridge for $600,000 less than he paid for it in 2004."

"'It's been hard for a whole bunch of us,' Ogles said. 'The bottom line is that nothing is turning, and whole lot more foreclosures are coming.'"

"The worst blow Ogles took was the foreclosure on his house on 137th Street East in Bradenton in July. Ogles had borrowed $327,600 against the house to support his business ventures and help pay money owed from his divorce. 'What really killed us is that banks are unwilling to do any land or development loans right now,' Ogles said. 'All I can do is let go of stuff, and try to turn negative into positive.'"

The St Petersburg Times. "Desperate to salvage the $300-million Trump Tower Tampa with last-ditch financing, SimDag, the Tampa developer of the proposed deluxe skyscraper, sought a nine-figure loan from Providence Funding Inc. Providence bills itself as a faith-based lender. Its chairman identifies himself as 'the Very Reverend Father Barney.'"

"With creditors baying for satisfaction last spring, SimDag principals Frank Dagostino and Jody Simon took the plunge. They paid Providence $150,000 as a 'loan commitment fee' to secure $200-million in financing for the 52-story condo tower. But Father Barney, the reassuring figure in the black clerical garb and white collar, is actually an ex-convict named Barney Canada."

"The Providence Funding revelation comes as SimDag's creditors gather today in a Tampa courtroom to press for repayment of nearly $40-million. It highlights the dubious sources and extreme lengths to which SimDag, rebuffed by conventional lenders, went in search of a substantial loan for a project largely given up for dead."

"Donald Trump, who licensed his name to the tower in exchange for half the profits, sued SimDag for breach of contract more than a year ago, taking the wind out of the project. 'If this information about SimDag is true, this is a very sad turn of events,' Trump spokeswoman Rhona Graff said on Thursday."

"Turning the tables, Father Barney's Indiana attorney, Thomas Lewis accused SimDag of bad faith. He said the Tampa developers withheld information about liens on the Trump Tower lot during the loan application. Said Lewis: 'These guys weren't exactly saints on the other end of the deal.'"

The Tampa Tribune. "For two years, Edwin Letras searched for a home he could afford. Discouraged, he thought his three young children were destined to grow up in a two-bedroom apartment. But the now-sluggish real estate market has brought better luck for the family."

"This weekend they're moving in to a new, three-bedroom, 1,271-square-foot house in the Highland Ridge subdivision in Hudson. They paid $138,400. Husband and wife both work at the nearby, and several of their co-workers are buying homes in the subdivision, too."

"'This is great,' Letras said while doing yard work last week. 'Real estate is finally low enough. And we'll already know some of our neighbors.'"

"Builders are rearranging floor plans, shrinking rooms, even changing the type of grass in the front yard to cut down on construction costs and offer more affordable prices. In some cases they're figuring out how to pack in four bedrooms, a feature in high demand for targeted buyers: young families."

"Smaller homes also can be profitable, especially at a time when builders have suffered from the housing bust: The price per square foot is about the same, said Kevin Robles, VP for the Tampa Division of Atlanta-based McCar Homes."

"The larger homes in Highland Ridge were 1,800 to 2,200 square feet and cost $189,000 to $259,900 in 2007. Kevin Robles, VP for the Tampa Division of Atlanta-based McCar Homes. said McCar didn't want to cut down on the number of bedrooms and bathrooms for the smaller homes, and they didn't want to put in cheaper light fixtures, flooring and cabinets. Instead, it cut costs by putting the garage in the backyard, and adding a front porch instead of a back patio."

"K. Hovnanian traditionally built smaller homes and catered to first-time buyers. As land costs rose during the housing boom, though, the company decided to concentrate on larger homes."

"It's changing directions again now that the market has slowed and land prices have fallen, Tampa division president George Schulmeyer said. The new communities the company is launching in 2009 will have homes starting at 1,130 feet and $117,900. It will continue to build homes up to 3,500 square feet and $360,000 in various neighborhoods, mostly in Pasco County, he said."

"One thing the company is doing to trim costs is to cut out vaulted ceilings and plant shelves, which were staples in many Windward Homes. They were popular because they give the home a cottage feel, Schulmeyer said, but they are an 'unnecessary cost.'"

"'When you have them, you're just giving away square-footage that could be used in a two-story,' he said. 'Also, they waste energy.'"

"Pulte Homes is experimenting with smaller home products as well, said Reed Williams, VP of sales and marketing. In both Harrison Ranch in Parrish and Trillium in Hernando, new homes start at $127,400 for a 1,265-square-foot home and $131,400 for a 1,598-square-foot home. The two communities are 70 percent of the Tampa division's sales right now, Williams said."

"For Pulte, he said, the thinking was to target first-time homebuyers who don't have to sell another home in this problematic real estate market. The only thing holding many of those buyers back, Williams said, was price."

"'The response has been fantastic,' he said. 'People are a bit skeptical as what they'll get for this amount of money. But they're pleasantly surprised. You can get into these homes for about $1,100 a month.'"