July 01, 2007

Crashing prices, decaying empty unsavory neighborhoods and housing quickly turning into the American Nightmare



It's sad to see families get into housing and flipper neighborhoods at the exact wrong time, falling for the slick marketing brochures and ads, and now facing a total freaking nightmare. But of course, they'll blame everyone but themselves for the mess they put themselves in.

Note - I'm short KBH at time of writing, since they build cheap neighborhoods like these that people will no longer want, their buyers are (were) more subprime , and they were crooked at the top.

And the chart above is the Zillow of the KB Homes house mentioned in the article.. Ouch. Remember new home buyers and current homedebtors - the builder will f*ck you every time.

Lodi homeowners find dream neighborhood not so charming

Scott McClarrinon says he was duped.

The 31-year-old Galt native thought he was buying into a dream when he and his wife purchased their home at The Villas of Lodi in November 2005.

He imagined he would raise his family in the two-story stone and stucco home at 455 Tuscolana Way. His home is tucked among 80 residences at the tastefully designed subdivision, complete with stately light posts and cobblestone courts.

Yet as soon as McClarrinon moved in, his dream and his neighborhood began to crumble.

The homes that had been snatched up so quickly at the peak of the housing boom sat empty for months at a time, with their owners nowhere to be found.

Green lawns turned to brown, left unkempt in the hot spring and summer months. Tall weeds began to sprout in place of neatly landscaped front gardens. "For sale" signs popped up throughout the neighborhood, replaced later by "for rent" signs. Pigeons began to roost on top of abandoned homes, leaving a mess below.

McClarrinon's vision of a vibrant community of homeowners — as promised by builder KB Home — vanished.

"There's just not a lot of homeowners here," he said this week, noting that his neighbors now consist of renters, from a trio of exotic dancers next door to a group of five young men nearby who throw loud parties late into the night.


"I'm so mad. I'm just mad," McClarrinon said. "My property value has dumped ... I've got the worst of both worlds," he said.

37 comments:

Anonymous said...

damn thats one sick chart

Anonymous said...

wait until the section 8ers move in. he may just rent his house house and go rent in a neighbor-hood with old houses and old people who are quiet stable and say hello. if he had thought about that before he bought the brand new he would not have been in the mess he is in now. i love older neighborhoods so much more character and the houses were built strong and meant to last, by AMERICANS. what is left to say.

Anonymous said...

These new suburbs of foreclosures are going to be ghettos full of unemployed Mexicans

Anonymous said...

Lot of money being lost fast now

Anonymous said...

Sounds like the same thing that is happening in Wilmington Delawhere's "Posh" Riverfront community which is surrounded by good ol' fashion Northeast ghettos & defunct industrial sites. Crack whores & homeless people wandering around and sleeping in the alcoves of the vacant, never lived in fliptard owned units which are now being hawked for tent by floplords, prices/values cratering because post bubble everybody woke up one day and said "Hey" its still a shithole and all thats going to happen is that the ghetto will swallow up the upscale 'hood. Developer and his realtwhores knew this going in so they hawked the units to naive non-natives who would not realize they were putting both their bank accounts and lives at risk. Realtwhores are getting a double profit because the sold the units and then the fliptards hired them to resell them immediately, the few who lived there also immediately turned around to sell when the realized the grand plan to make the place a community was just a big fat lie and that they would have to cross their fingers and stay imprisoned in their homes for a decade and hope the pimps, drug dealers, crack whores and roaming thugs would just go away!!!!!

Anonymous said...

I thought home price can only go up?

Anonymous said...

I have 3 friends on section 8. They couldn't be nicer, cleaner more quiet people!!!

Try to grow a brain instead of spouting your stupid mouth.

Everyone is different. Some Sect 8 pepole are no good, some are wonderful.

Do pepole get paid to be ignorant and/or stupid?

Anonymous said...

Damn that's an ugly zillow

Anonymous said...

How quickly everyone forgets about Grow Houses!

Those will bring housing prices back!

Anonymous said...

Poor bastard - sounds like his name should be John Galt (Atlas Shrugged).

Anonymous said...

Me and my wife have looked at about 5 townhomes here in NH. Four of those had young families/couples that bought them in 2004/05. They won't be able to sell at a profit or even break-even. Regular homes have moved down enough that they are almost the same when including condo fees. One of them was asking for a high price that was just plain sad.

I-hate-mowing-lawns said...

"Green lawns turned to brown, left unkempt in the hot spring and summer months.... "

Fear not homedebtors. Your lawn isn't dead. It is dormant. A natural occurance during the dry summer months.

K.W. - Southern Ca. said...

Sadly, the problem in Lodi will become common-place in many areas
across the country.

The areas with the highest speculated increases in house prices will be hit especially hard.

Empty homes tend to be magnets for "squatters", and of course increased drug-use and crime.

Unfortunately, some of these new transients have a story of their own .... some where once house debters themselves.

Welcome to the "New Economy".

az_mtb said...

My wife and I live in a brand new neighborhood on the NW side of Tucson. We are renting our nice new 4b/2b home from a poor floplord who bought at the worst possible time in 2005 for at least $700-800 less per month than owning it would cost us. There are no fewer than 4 other identical homes for sale on this street with the same floorplan and none of them are going anywhere. We just told our floplord we were interested in renewing our lease for another year and they were gushing all over us! They didn't even raise rent! I think they are stating to understand the gravity of the situation and that this will not be a short-term correction. They would rather have us occupying it to reduce the bleeding than have it sit empty. They are very nice people, but I want to say so badly to them "Thanks for subsidizing our great lifestyle!"

Anonymous said...

ARM- Adjustable Rate mortgage- reset schedule that Credit Suisse produced:

http://www.attheselevels.com/archives/678-The-Forgotten-Resets.html



We expect more foreclosures as these rates rise. Currently here in Alabama , 18.2% of subprime loans are delinquent according to the Mortgage Bankers Association. As Wells Fargo CEO Richard Kovacevich said in December about the subprime market: ``I am not a forecaster of the future; I'm a historian. And history says this will blow up. It always has. And there will be some blood on the street.'' But whose blood?

Anonymous said...


I have 3 friends on section 8. They couldn't be nicer, cleaner more quiet people!!!


Yeah Section 8 neighborhoods are the best. Compton, Watts...everybody wants to live in a Section 8 neighborhood.

stuckinthecity said...

But they also contend that KB Home misled them about what kind of community they were moving into — a now blighted neighborhood they say threatens to drag their home values even further down.

They say the home-building giant promised to not sell to out-of-town investors — people who likely would not live in the homes or take close care of them.

Reached for comment this week, a KB Home spokesman said his company can't always control who moves into one of their communities.
--

Maybe it was the locals that saw the quick bucks and tried to flip.

Jason said...

I have 3 friends on section 8. They couldn't be nicer, cleaner more quiet people!!!

The quality of life in a community isn't determined by its best or even average members, but by its worst. Once you have a core of taggers, vandals, car thieves, drug dealers, and gang bangers, it doesn't matter how nice, clean, and quiet the rest are.

Anonymous said...

Anonymous said...
I have 3 friends on section 8. They couldn't be nicer, cleaner more quiet people!!!
--

Those 3 are your drugdealers aren't they? Wonderful people I'm sure....

wine country dude said...

@ anon 11:53

At least you only accused the initial writer of stupidity, and not expressly of racism, so society's ability to discuss these things clear headedly may be improving.

The problem is this: Section 8 tenants are disproportionately--highly disproportionately--guilty of poor upkeep, and disruptive and criminal behavior. This is not to deny that there are some fine, individual Section 8 renters. I believe your anecdotal experience, but it is simply that.

Recently, the Contra Costa Times published a story about the influx of Section 8 renters into Antioch, California and consequent problems with law enforcement (not merely criminal conduct, but also civil code enforcement). The Section 8-ers were responsible for the problems out of all proportion to their percentage of the population.

I believe that to be true. I also do not question your anecdotal experience. Where does this leave us? Are we prohibited from making generalizations that are, in broad swath, absolutely accurate, even though the experience of some individuals may differ?

These are serious questions, even if you may not treat them as such. Ask yourself, honestly, how you would feel if there were an influx of Section 8 renters into your neighborhood. Ask yourself, honestly, whether you would buy a house, or even choose to rent, in a neighborhood that had more than a statistically insignificant percentage of Section 8 renters.

Look: if I am walking down a dark street and hear footsteps behind me, will I respond differently if the person behind me is a white man in a suit, or a black teenager? The answer is obvious, and simply reflects that we all make split second survival judgments each and every day that are based on experience, that are true in the aggregate, and that may have the unfortunate effect of hurting some individuals.

We're not going to stop doing it, either, none of us. Not even if the suited white man following us this time turns out to be Jeffrey Skilling and the black teenager is coming home from a meeting of the local 4-H club.

Anonymous said...

Where the heck did you think the phrase, 'There goes the neighborhood' came from?

Joe said...

I remember Greenspan being questioned about the housing bubble. His response was only the people that buy at the top will be hurt. Well there you have it millions of home debtors. You were Greenspan-ed and plugged.

Anonymous said...

Section 8 people are scum. They are welfare collecting pieces of filth. The fact you are friends with them tells me what a low life you are.

Anonymous said...

I don't buy anything zillow says good or bad. According to zillow my house is worth $40K more than when I sold it in 2006. In reality it's worth about $40K less based on what others in the old 'hood are asking.

Anonymous said...

When the banks or HUD can no longer move the properties why not have the state lottery raffle the houses away?

Sure someone who is 18 and making $7 per hour can win a $500K home for $1 so he would lose the house if he did not sell it pronto to make some money but at least the house will have been paid for once with the lottery.

Lottery for homes is the only way out now.

Paulin08 said...

Anonymous said...

I have 3 friends on section 8. They couldn't be nicer, cleaner more quiet people!!!

Try to grow a brain instead of spouting your stupid mouth.

Everyone is different. Some Sect 8 pepole are no good, some are wonderful.

Do pepole get paid to be ignorant and/or stupid?

July 01, 2007 11:53 AM

STFU.

You are ignorant.
You think because you know three sec 8's out of the millions, that the documented fact that sec.8's lower property values is now bogus?

And yes, people do get paid to be both ignorant and stupid, just ask your Sec. 8 buddies, turd.

turdly said...

Some of the slums in St Louis MO are made up of homes that cost 15 times annual income to build. They were the nicest houses, in the nicest neighborhood in the whole world. Now the lowest of the low live in these once magnificent Victorians. Will this be the fate of McMansion neighborhoods?
Indigent families aligning with others to rent these utility sucking palaces as communal living areas? Will they be driving Hummers like they now drive 1985 Cadillacs?

Section 8. I have many relatives in section 8 I do not let them in my home. Think what you want. While visiting them concerning some illness in the family I did meet some of their neighbors who were quite charming. A few of them were high functioning retarded people. Very nice, very quiet, like a well mannered 7 year old. Most were not. Most are having taggers and drug addict relatives flop with them.

turdly said...

I just heard something that sparked a memory. Are todays housing bubble screwups the same people who thought they'd make millions raising alpacas and ostriches? That's the first time I ever hollered [and not since] at my dad. He was going to hock the house to raise ostriches and emu's. I sat in his house, uncomfortably after the arguement] and diled EVERY restaurant in Phoenix and Tucson, and not one sold ostrich meat. We don't talk much about that day, but it saved his house.
I'm guessing amateur flippers didn't have anyone who cared enough to holler at them.

Anonymous said...

What happened to Sections 1 through 7?

forrest said...

if the suited white man following us this time turns out to be Jeffrey Skilling

I wouldn't be afraid of Jeffrey Skilling. Jeffrey Dahmer would send me running though.

Anyway, what you say is true. I used to live in the Northeast section of Dallas around Skillman/LBJ and Lake Highlands. That used to be the place to be. Professionals and young families populated the area and it was safe with lots of things to do. As some of the older apartments there turned to Section 8 the crime rose quickly. Drug dealers, murderers and Crips/Bloods gang members infested the area. In 5 years, it went from one of the best areas in Dallas to the most dangerous. Double and triple homicides are common now as are soiled diapers in the streets. Most of the stores and shops in the area had to close down because of the armed robberies and assaults. I'm sure some of the Section 8 people were good citizens. The proportion that were scum was much greater than the general population. Run away, run fast

Anonymous said...

Ha! Winecountry I hear ya dude. Whenever I see a middle aged white man walking down the srreet like he has his nose up his ass I cross the street. They totally freak me out. Specially when they stink of old wine.

K.W. - Southern Ca. said...

I'd be carefull with those
statements.

House debters may be forced into Section 8 due to the housing melt-down firmly underway.

Are they then also "scum" ?

~~~

Anonymous said...
Section 8 people are scum. They are welfare collecting pieces of filth. The fact you are friends with them tells me what a low life you are.

K.W. - Southern Ca. said...

Well, you and your wife shouldn't be so smug about your situation, just consider yourself fortunate.

You'll need to look broader than your own situation to realize the housing crisis affects even those who didn't get caught-up in the feeding frenzy.

My hope is that anyone affected by this crisis - to the point of loosing a roof over their heads - can get back to a decent standard of living ASAP.

This is not a "Their Problem" scenario, it will be all of ours to share to some degree.





az_mtb said...
My wife and I live in a brand new neighborhood on the NW side of Tucson. We are renting our nice new 4b/2b home from a poor floplord who bought at the worst possible time in 2005 for at least $700-800 less per month than owning it would cost us. There are no fewer than 4 other identical homes for sale on this street with the same floorplan and none of them are going anywhere. We just told our floplord we were interested in renewing our lease for another year and they were gushing all over us! They didn't even raise rent! I think they are stating to understand the gravity of the situation and that this will not be a short-term correction. They would rather have us occupying it to reduce the bleeding than have it sit empty. They are very nice people, but I want to say so badly to them "Thanks for subsidizing our great lifestyle!"

Joel said...

Is he mad about his home's value tanking or that strippers and drunken college kids are smarter than he is.

Anonymous said...

Whenever the fleeting thought of moving back into a subdivision enters our mind, this is all we need to remember to consider ourselves blessed to live on 11 acres with no neighbors within line of sight on any side. Are you kidding me? People choose to live this way (with loud, obnoxious neighbors living an arm's reach away next door and across the street)? And, they pay a premium to do so (as much or more for a small, poorly constructed tract home than we paid for our 6,020 sq. ft. home less than 25 minutes from downtown, in Dec. 2004)?

Anonymous said...

"Joel said...
Is he mad about his home's value tanking or that strippers and drunken college kids are smarter than he is.

July 02, 2007 6:17 AM
"

Classic !!!!!! HAHAHAHA

Anonymous said...

So someone held a gun to this guys head and made him buy? Galt, Lodi..has anyone on this blog ever been there? Absolute shit! An idiot will always be an idiot! Never buy in GALT OR LODI!!