Cities and Counties Owning Foreclosures?
By Barbara E. Hernandez
Wednesday, April 30th, 2008 at 8:57 am in Foreclosure Fever, The Market.
Yes, it may sound familiar to you faithful readers, about Perata’s mortgage and foreclosure relief bill currently in the Assembly, but here it is:
In Oakland, you can see a house or two in foreclosure and it’s obvious right away,” he said, saying the bill was an important step to preventing further deterioration of neighborhoods. “It’s like watching a house burn and you can’t do anything about it.”
Perata said that the bill gives local governments the ability to put liens on the property until it’s maintained. That means if the property owners, whether a bank or investors or a mixture of the two, do not clean up the property they could lose the property to the city or county.
“Cities and counties could be in the housing business,” he said.
Well, I thought that was an interesting point of view. Cities or counties owning some of these foreclosures … hmmm. Start dream sequence … OK, end it. I’m not sure that will happen, but perhaps it’s enough of a threat that the foreclosure owners may start maintaining them. Ideas, anyone?
[You can leave a response, or trackback from your own site.]
May 2nd, 2008 at 7:28 pm
Well, sure. Since dispersed welfare has become the norm with section 8 vouchers, why not? Those counties and cities will welcome not having to build any more public housing for a decade or two.
Whether or not they will be planting the seeds of neighborhood collapse is something more cops should be able to solve. Right?
May 2nd, 2008 at 8:12 pm
Perata’s mortgage and foreclosure relief bill is a very good start. In the condo market where foreclosures are mirrored by non payment of association dues, the association shows a lot of red ink. Finance companys now will not loan on these properties due to changes in government regs. So Perata’s bill needs to include the non payment of association dues as well.
May 3rd, 2008 at 9:05 am
I don’t disagree that something needs to be done about vandalism and deterioration of abandoned foreclosures. However I think that if passed, the bill may not turn out to be very effective. Homeowners in default who have abandoned their homes have no incentive to spend time and money maintaining and secure the home because they usually have no money, do not want the house and their credit is already shot from late payments and then forclosure. The banks are extremely overwhelmed with the number of properties that they now own too and I’m not sure if they have the resources, especially if the bank is located in another state, to visit and maintain these properties.
I do believe that once a real estate agent has listed the property, that agent has a minimum duty to visit the property and make sure it’s secure and minimum maintenance is done so that the property is not hazardous to prospective buyers or neighbors. Some real estate agents have so many bank owned listings that they have no idea of their condition. I’ve been unable to tour certain properties because doors were wide open or they were so filled with stinking garbage that the door wouldn’t open. I think that it would probably be easier and more effective to hold the agent responsible for that.