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Are Foreclosures Like Bad Apples?

Are Foreclosures like bad apples? Unfortunately we are all affected by the housing market in one way or another. All homes in the neighborhood are adversely affected. Foreclosed Homes and Short Sales become the comps for the area. These homes were once only the exception but they now are the rule. The bigger tragedy is Foreclosed Homes prices have resulted in the plummeting prices of other homes in the area. An immediate resolution is needed in order to restore our local, state and national economy to a sense of normalcy.

California State SB926 emergency legislation by Senator Don Perata designed to aid the ailing housing market and slow foreclosures failed on Wednesday.

Had the measure been successful it would have simply required the Governor's signature and it would have been activated immediately.

THE BILL was basically designed to:

•· Ease the foreclosure crisis

•· Remedy the sub-prime problems

•· Prevent further lose of home values

•· To restore the State tax revenue base.

A two-third majority vote was required. The final tally of 25-14 resulted in a razor-thin lost. Twenty-seven votes were needed to pass the Bill. It was clearly a party line split. All the Senate's (25) Democrats voted for, while 14 of the 15 Republican were opposed. It is sad in deed that there is no immediate resolution in sight to remedy the State's current dilemma.

Those that have not been impacted or don't think this is situation is a crisis probably have nothing to lose. For those of us that do, I highly recommend you contact your local or state representative regarding this matter. I leave you to ponder the question: Is the current housing market crisis the modern day Titanic?

Critical times require critical measures.

UPDATE: See and Hear First Hand Sixty Minutes House of Cards- Stockton, CA

Posted by Dionne Morgan Broker REALTOR®,GRI, e-PRO on 01/31/2008 06:20 PM

Comments (25)

critical times, vallejo ca homes for sale

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25 Comments on Are Foreclosures Like Bad Apples?

JAN

2008

Dionne ~ good post. I think the answer to your question is yes. Like bad apples.

FEB

2008

Dionne,
There is no question that a foreclosure in a neighborhood does impact the other homes negatively so the answer is YES. Does it affect all homeowners? Yes.

To each of you that have taken the time in your schedule to comment on My Blogs.

Please allow a day or so for me to respond. I am just returning from a short trip. Your time and thoughtfulness certainly deserves a relaxed response. Thank you so much, again!

Warmest Regards,

FEB

2008

Dionne..Great Post as always!I think we are all dealing with the bad apple syndrome these days.

I think you get the copper frying pan for this one...CLUNK away my friend!

BLR GUY, Thank you for your acknowledgement.

I am not familiar with the foreclosure situation in Florida, but in California we simply can not ignore the impact of foreclosures on our local housing market. Stockton, CA has been nick-named 'Ground Zero' the foreclosure capital. I live and work in Vallejo, CA. My county, Solano County, has been labeled for it's foreclosure rates. I concede that there are no overnight remedies but we do have to begin somewhere.

Dionne, very interesting post. Foreclosures are affecting the housing market in Florida too, as in many other states across the nation. It's believed that this year is going to be much worst still, particularly in the condo market. The situation reminds me a bit of the time when I just got my real estate license, during the 80's. At that time the culprits of so many foreclosures were the dreaded adjustable negative amortization mortgages and the extremely high interest rates. Now there are many culprits and the situation is more complex. I believe it will take a bit longer to clean up "house" this time.

RoseMary, thank you for dropping by. If anybody knows, you know. I consider you a local resource on the subject. Best wishes to you and your community.

Side Note:

Sixty Minutes recently profiled the city of Stockton, CA. The story was called the 'House of Cards'(1/28/08). The city has been nick-named 'Ground Zero'. RoseMary Brooks is a successful and committed Stockton Real Estate Broker/Notary that has seen first-hand her community rise to over 4200+ foreclosure at this very moment. There are over 4200+ stories behind each home. I don't know how seriously foreclosures are impacting the local economy elsewhere in the country, but in California we are very concerned.

CYNTHIA, thanks for your clear-cut observation.

In order to resolve this complex situation, we have to acknowledge it. We must maintain a sense of positivity and look forward to some workable resolutions to restore our economy.

GRISELDA, it sounds like this is not your first time at the rodeo. It appears we will need to use all our collective resources on this bumpy ride. Complex as the situation may be, I am hopeful the fog may soon rise. Thank you for sharing your past knowledge regarding other markets we have overcome.

FEB

2008

Dionne: What is their rationale that it would be much worse for you if the legislation had passed? The sub-prime has created a very complex problem and no one knows the solution to the problem. It's a scary situation for the people in California. So far, we have not seen those problems here in Tennessee.

Whewwee, this is a major serious problem, I just got done reviewing some numbers in Atlanta, Riverside CA, South Florida, Las Vegas and Pheonix for our online think tank, oh my gosh, you said it all right here. Its a huge issue, we must do something or its going to be a while. Lance

UPDATE: Hear and see first hand

Sixty Minutes House of Cards- Stockton, CA

FEB

2008

JAN the rationale has yet to be revealed. The major good would be a lock on the needed tax revenue. This is certainly a time for dialogue not division. I do trust, for the greater good, that communication will heal this entire ugly chapter in our state's history.

LANCE, This too shall pass. I will anxiouly wait and see how history unfolds. Meanwhile we have enough lemons for lots and lots of lemonade(lol).

MAY

2008

Dionne, this was one time I was very pleased with Sixty Minutes reporting...I thought they were right on the money about exactly how the whole mess happened. As for legislation, well, it depends. I personally think some of the Foreclosure Relief Bill will help but in reality it's much better if steps are taken locally and not nationally, if that makes sense. Good post thanks!

Carol, I just hope the bleeding stops soon. In my area foreclosures/REOs/shortsales are the norms now, not the exceptions.

Dionne we had (a really good NE Ohio blogger tracks this) over 150 foreclosures in our Co and it has stayed pretty steady. I hope your area recovers soon too - I'm expecting nothing here to change much until 2009.

JUN

2008

I have a very motivated buyer who is looking to purchase bulk reo's ranging from 400million to 5 billion. My client is easy to work with, however needs proof that you actually have the product before giving a LOI. I am looking to establish a working relationship that way we can do business on more than one occasion. Please email me at josh@nwlsusa.com if you are able to produce proof of product. I am tired of jumping through hoops when in the end the seller doesn't have any product. I am on a deadline because my client is trying to buy up as much as possible so he can pay less in taxes. Please a friendly reminder do not ask for LOI or MFA before proving you have actual product to sell.

Joshua Loeb

J. Loeb Inc

818-428-1059

JUN

2008

Hey this guy Josh--is all over the place is he spamming or what

Carol, This is certainly a markrt to observe and adapt to. The cycle simply must work out it course. Best wishes in all your efforts.

Josh, who ae you? Is this how you normally do business? I guess this is just my lucky day.

Aida, so you are telling me this isn't my lucky day (lol)? I am sure smeone will take the bait from this spammer.

JUN

2008

Well, I can tell you I was under contract on a foreclosed home and the appraisal came in lower than contract price! My buyer still wanted the property, so we thought (stupid us) that the bank would go through with the deal at the appraised price and we would close! WRONG!!!

The bank has now several weeks later, lowered the asking BELOW what the appraisal came in at (how stupid), so we just submitted another offer...A LOT LOWER! Had they not been so idiotic, we would have closed this past Monday!

What makes the bank think for one second that a buyer is going to pay MORE for a property than what it appraises for. Let alone, the buyer's lender won't allow it! This is a bank that owns the property...HELLO out there...you lend money, obviously, this is why you have the property back!

I'm sorry to hear your state legislators are as good as ours in Florida...clueless at times! Something that would help us out of this situation and they vote it down.

Let's keep our chins up, better days WILL be coming!

JUN

2008

Chris, thanks for the encouragement (LOL). It certainly has to get better and yes better days are coming. I love your story. What was the lender thinking? Please copy and blog this to share it with everyone it is humourous.

JUN

2008

Dionne...I never thought of that...I will have to now go and put this out to the world! Thanks.

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