Housing Crash Consequence #2857: Screwed Homeowners Associations

Again, like a broken record, as predicted here, homeowners associations across the land are running into big issues now that the housing gamblers and failed flippers can't pay their monthly nugget - or can't even be found.

Choice A: Cut services
Choice B: Get the demoralized residents to keep up the joint
Choice C: Raise everyone else's HOA fee
Choice D: Go bankrupt
Choice E: All of the above

I'd love to hear what's going on in Failed Flipper monuments like the Third Avenue Lofts in Scottsdale, or the Club at Brickell in Miami for starters. Not quite the HOA-paid-for wine and cheese parties everyone expected, eh?

Foreclosures force HOAs to cut corners on upkeep

Homeowners associations strapped by unpaid assessments related to the foreclosure-ridden real-estate market are mustering volunteer work crews, cutting maintenance jobs and scrimping on landscaping to save money.

Phoenix, Chandler and Avondale are among Valley cities fielding calls for help from HOAs that previously turned only to their own boards of directors and management companies.

Rising Foreclosure Rates Cause HOAs To Fall Into Bankruptcy

ORANGE COUNTY, Fla. -- The Avalon Lakes Homeowners Association was on the brink of bankruptcy. At one time, it had a $140,000 deficit. The subdivision said people who fell into foreclosure stopped paying their HOA FEES.

“The people that weren’t paying, still aren’t paying and we’re basically paying for them,” said Cynthia Weclew, a homeowner.

There are concerns about what will happen to the communal areas of the subdivisions if the HOAs can’t afford the upkeep.

McMansions as the Next Slums: "I never imagined in my wildest dreams that stuff like this would happen."

The housing crash will play out in ways that will surprise and shock even us. McMansion ghettos. Bullets flying. Scum living in gated communities. Unkempt lawns and foreclosed houses everywhere. And NOTHING like the wine and cheese brochures the realtors showed you.

Coming to an overbuilt unwanted suburb near you. And all powered by no-down, no-doc, no-responsibility toxic loans.

Thanks Bill @ maryland for the link

The Next Slum?

The subprime crisis is just the tip of the iceberg. Fundamental changes in American life may turn today’s McMansions into tomorrow’s tenements.

Strange days are upon the residents of many a suburban cul-de-sac. Once-tidy yards have become overgrown, as the houses they front have gone vacant. Signs of physical and social disorder are spreading.

In December, after a stray bullet blasted through her son’s bedroom and into her own, Laurie Talbot, who’d moved to Windy Ridge from New York in 2005, told The Charlotte Observer, “I thought I’d bought a home in Pleasantville. I never imagined in my wildest dreams that stuff like this would happen.”