Foreclosure Concentrations Vary From Place To Place

March 4th, 2008

While many are moving out bag and baggage buses roll in with potential buyers hunting for sharp deals now that the prices of real estate are at an all time low. In Dallas-Fort Worth there over 19,000 foreclosures in 2007. Each month thousands are running into default.

A study conducted by The Dallas Morning News shows that in North Texas foreclosures have not made any choices as regards neighbourhoods economic status. Lenders being weighed down by the sheer number of foreclosures are looking for quick sales. The number of would-be buyers are also increasing. The buses are full – each with a seating capacity of 22. The tour operator feels that more buses will have to be hired. Also buses will be scheduled to ply other regions. Last week a foreclosure bus toured Carrolton and Lewisville to view eight units. The possibilities in North Dallas are being weighed where there are some real bargains waiting. The cloud over the housing market spread from rich towns to the distant suburbs. It has cut across economic and racial barriers.

The Association of Community Organizations for Reform Now or ACORN is working together with both lenders and borrowers so that the latter do not get uprooted. Foreclosed houses are infecting the neighbourhoods with the wrong type of vibrations. The value of houses in the entire region goes down. Crime and criminals walk in. Each foreclosed unit causes the real estate market to drop by 1% - thus the total effect could be astounding in any one pocket where there are many foreclosures. Eastern and southern Dallas have been badly hit last year by foreclosures. Pockets are growing in McKinney, Keller and Frisco. The worst was DeSoto with zip code 75115 where lenders have taken over 600 properties. Texas will lose out $2.7 billion in real estate value because of the sub-prime fiasco. The sub-primes make up 15% of the local mortgages but they are responsible for more than 50% of the foreclosures. Dallas-Fort Worth region will be slapped by a loss of $4 billion affecting the total economy of the region – it being predicted by a conference of Mayors. One analysis shows that most of the foreclosures cloud the regions which have newly sprung up but indirectly the infection is going to spread.

The lenders are being told to see to the maintenance of the empty houses to prevent crime. It is their untold responsibility.