Impact of Foreclosures in a Community

Real Estate Agent with Berkshire Hathaway HomeServices - Homesale Realty RS292802

 Impact of Foreclosures in a Community

We all know of the economic impact that a foreclosure in a community has. Too many REO's/Foreclosures will bring down the value of your home if you are looking to sell. We all know the toll it takes on the previous owners. But what about the emotional toll it can leave for the neighbors?

We were conducting an Open House a few weeks back on a Foreclosed home in a quiet, tree lined street. During our prep work for the open house, we knocked on the doors of neighbors to hand out flyers and to welcome them to come through the open house and invite family or friends that may be looking to move into the neighborhood.
We received a rude awakening. The previous home owners were good friends with the neighbors and they weren't too happy with us. They were bent on not attending the open house because of what they felt WE did to the previous homeowners.

I have to admit, we weren't too prepared for that kind of reaction from neighbors. There really is no script for this. At first we just figured it was this one neighbor that was pretty mean and wasn't having a good day.  Low and behold the next two doors that we knocked on had similar reactions to us.

Let's re-group and think about this for a minute.... The previous homeowner's have built a life in this home and in this neighborhood and community. PTA meetings, soccer, baseball games, spent days mowing lawns, cleaning windows, walking outside to pick up the newspaper. Countless moments talking with neighbors and here we all bright-eyed and chipper that we are having an open house on a home that is being sold that the previous homeowners may not have wanted to move out of.  We had to figure out a different approach. The last thing we want to have happen is to be the Team that kicks people out of their home without empathy.

So, the 4th house we go to...."Hello my name is Darius with Prudential Homesale Services Group. I've been tasked with selling the home listed at 123 Main St. I understand that Sally Homeowner may have been a friend of yours and its unfortunate as to why I was given this task. Although we don't take any joy in the reasons the home is on the market, we do take great joy in trying to find a new homeowner for such a great home, in a great neighborhood, and with obviously friendly and caring neighbors. I am holding an open house this coming Sunday and I welcome you to come by and join us. If you know of any friends or family members that have been asking to move into this neighborhood I ask that you invite them as well."

From this point on, we had pretty good success with interacting with neighbors, and in the end, had a pretty good turn-out.

The impact of Foreclosures/REO's go beyond the financial impact and the decline of home prices.

Sellers, if you are struggling because of job loss, divorce, death, or decrease in income, reach out to a local Agent that is educated in the Short Sale Process.

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Darius Ramsey
Prudential Homesale Services Group
Posted by

Darius Ramsey, CDPE
Prudential Homesale Services Group
3435 Market St.
Camp Hill, PA 17011
(717) 761-7900 Office
(717) 884-8190 Cell
(800) 606-2501 Fax 


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Lenn Harley
Lenn Harley,, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

The owners/ the owners' family/ the neighbors/ the community/ the township/ the shops/ all suffer from the negative impact of foreclosures and short sales. 


Oct 23, 2012 07:41 AM
Melissa Marro
Keller Williams First Coast Realty - The Marro Team - Orange Park, FL
Jacksonville Real Estate and Home Staging

Darius - I agree that everyone is impacted by this, including family, friends, and even yes, the neighbors. Did you see Larry Crowne with Tom Hanks? He lost his job and his home and his neighbors rallyed around him... 

Oct 23, 2012 09:53 AM
Patrick White
Home Driven Realty, Inc - Baldwin, NY
Driven to bring New Yorkers home

Good Evening Darius

Thanks for the post and information. You are correct. The financial and emotional impact can be devastating. I do try to expain to neighbors and friends that we are trying to protect property values by getting the foreclosure or short sale sold.

Thanks for sharing. Have a great day

Oct 23, 2012 10:47 AM
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

Darius -- you raise a very good point here.  I had not really thought about this or how to handle this situation with neighbors.  I think you did a fantastic job.

Oct 23, 2012 11:45 AM
Chuck Mixon
The Keyes Company - Cutler Bay, FL
Cutler Bay Specialist, GRI, CDPE, BPOR

This market has taken a terrible toll on the families, and communities as well as the economy. I was hoping that we would go thought a fast foreclosure cycle 5 years ago and all the bad medicine would be over by now.  Instead with all the federal programs to try and repair and keep home owners in their homes has done more harm then good to the point we are still going thought the pain and will do so for a few more years until we clear up the surplus and excess inventory of foreclosed homes on the market. We have dragged out the inevitable  far too long.

Today home sit vacant and vandalized, the communities and local government are broke all because of the housing market. We need to face up to the medicine and get this problem behind us so families can get back to there lives, and communities can grow, and fund the required services. I am aware of the problems in Harrisburg, PA. we are have the same problems here just on a smaller scale.

As Realtor let's rally troops and get the homes in our community sold to families and get our industry back on all four wheels and firing on all eight cylinders.


Oct 23, 2012 12:08 PM
Wayne Johnson
Coldwell Banker D'Ann Harper REALTORS® - San Antonio, TX
San Antonio REALTOR, San Antonio Homes For Sale

Darius-That was a nice recovery on the neighborhood situation. I can imagine the people in the area not being happy about the foreclosure process and the affect on their friends and neighbors.

Oct 23, 2012 12:10 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Darius - It's good that you were able to understand how important the previous homeowners were to the neighborhood and do something about it.

Oct 23, 2012 01:13 PM
Michelle Tucker ~ Pooler Real Estate
!Daley Real Estate - Pooler, GA
Rincon~Savannah~Richmond Hill

Darius in Central PA: Very true. As Realtors, I think we see the BIGGER picture/impact the REO's are doing to the communities.  Glad you were able to change your approach quickly with the neighbors and have more success.  Hopefully they will realize, the faster the houses get out of inventory the better the community will be. Did you put the house under contract during your open house?  

Oct 23, 2012 02:15 PM
Darius Ramsey
Berkshire Hathaway HomeServices - Homesale Realty - Camp Hill, PA
REO/Short Sale Specialist
Unfortunately we weren't able to put the home under contract but we are in touch with the visitors that have come through the open house. We were also able to reach out to some of the neighbors to find out what they like most about living there and hearing their insight. You guys (ActiveRain community) have offered some tremendous advice. I'm relatively new at blogging being three months into it but I find myself coming here first to share stories and experiences. Thank you all.
Oct 23, 2012 02:25 PM
Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

Darius, your post brings awareness to all Realtors who sell foreclosures.  To some extent, the buyers of these properties also have to deal with the feelings of the neighbors.  You have done something very positive for this neighborhood.  Congratulations on your feature!

Oct 23, 2012 02:55 PM
Monique Keith
Ahwatukee, AZ
Ahwatukeenulls Favorite Realtor, Buyers Agent with

Darius, I wonder if some of the negative reaction you were experiencing had to do with the previous owner trying to do a loan modification and the bank denying it, then the bank foreclosed. I have heard more banks spend the same amount of man power working a loan modification that they would spend on the foreclosure. That they rather foreclose and be done with the lender. 


Oct 23, 2012 03:14 PM
Tracy Oliva
West USA Realty - Arizona - Fountain Hills, AZ
The Oliva Team Arizona Agents

This is some eye opening Info for all,  keep up the good work and good luck with your business,  E

Oct 23, 2012 08:54 PM
Ginger Harper
Coldwell Banker Sea Coast Advantage~ Ginger Harper Real Estate Team - Southport, NC
Your Southport~Oak Island Agent~Brunswick County!

I am ready for the depressed properties to get out of our market.  They bring our appraised properties down so much lower.

Oct 24, 2012 04:29 AM