Friday, July 27, 2007

Dismal Housing Market Effects Everyone

Living in a state that hovers near the top of the list of home foreclosures - Ohio - I am quite aware of our current housing situation. It is sad to see such a large number of people losing their homes. Many of these homeowners were victims of predatory lenders. But while this might have seemed at first glance to only effect those consumers who "didn't do their homework," the reality is that this effects everyone.

Let the Blame Begin recounts how banks and others shrug off their culpability in this whole sordid mess. However, in watching a recent segment on the NBC Nightly News, and CNN, the point of how this impacts everyone else was well made. For instance, did you know that when a home is foreclosed upon, it takes the homes around it down an average of $75,000 in value? Additionally, consumers with above board loans have seen an increase in foreclosures, too. With the market flooded with foreclosures it is difficult for everyone else to sell their homes. If they are able to sell, they are often forced to accept a much lower price.

This is a critical situation. American citizens are already bleeding money with the obscene price of gasoline, heating oil, the increase in food prices, related to gas prices, etc. The foreclosure rate is up about 87% from a year ago. If that is not a critical situation, I don't know what is. Perhaps the WMDs we should be targeting is predatory lenders.

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1 comment:

appletini said...

I was reading an article on this the other day, in the Los Angeles Times.
The increase in foreclosures was insane!
It is a huge problem and inevitably impacts the economy..... and us!