JAMES LILEKS ON THE HOUSING SLUMP:
I’m on a neighborhood email list that has some people who work in the real estate and financial field and they report that one of the remarkable problems with these properties is that the owners often don’t really seem all that interested in selling them. The owners being banks, finance companies, etc. You would expect that when the price drops below a certain point, buyers want to buy but not if the sellers won’t cooperate.
I think that the problem is that a lot of them still think that this is a game of hot potato–they think they can unload the dogs as paper to another institution with less hassle. Somebody needs to tell them game over man.
I am not saying it has to be the government, but there is an accountability problem here. Some of the entities that hold these houses are big banks with shareholders, who ought to be concerned about the financial health of a bank that is essentially treating properties as losses without actually writing them off. I am also waiting for some enterprising lawyer to sue a bank for not maintaining a property that leads to some awful crime. Right now, the lack of maintenance is mostly creating headaches for neighbors, in unshoveled snow, uncut grass, etc. One realtor mentioned that a lot of foreclosed property owners didn’t bother winterizing the houses and now some have ruptured plumbing to go along with all the other problems that make it an unattractive purchase.
Plus, inklings of worse to come.
UPDATE: James Lileks emails: “That’s not James Lileks. And I should know, being him. Itâ€™s from another buzz.mn blogger.” D’oh! The dreaded co-blogger confusion strikes again!