11/15/2011 11:26 AM ET|
Should we tear down foreclosures?
The case for demolition is compelling, as long as the foreclosed home's location and condition justify taking it down. If a rehab is not worth it, bring on the bulldozers.
Let's get rid of foreclosed homes. Demolish them. We'd be better off without them, and here's why.
Many of them are vacant or abandoned, and those homes attract squatters, rodents and/or criminals. Such homes often get stripped of appliances, pipes, windows, doors and other materials.
They quickly become a visual blight on a neighborhood. They rapidly decline in value and require money to pay taxes and upkeep, which can outstrip the return from a potential sale.
As they go, so goes the neighborhood, with homes nearby also losing value. As the neighborhood goes, so goes the tax base, lessening the revenue to the municipality where these homes are.
And in today's economy, there are plenty of unemployed Americans available to do the demolition.
'2 main considerations'
The above might not apply to every home in foreclosure, but a familiar real-estate mantra can be the guide to choosing which homes to demolish: location, location, location.
Add one more thing to the chant: condition.
"Two main considerations go into the decision to bulldoze a property: market condition and property condition," said Rick Sharga, who was the senior vice president at RealtyTrac, an online marketplace of foreclosure properties, before he recently left to become the executive vice president at Carrington Mortgage, a financial-management company.
"If you are located in a down market where there has been a loss of jobs, population or both, then there is no one to buy the properties," Sharga said.
RealtyTrac began posting foreclosure records in 2005, and Sharga estimated that of the 800,000 properties still on lenders' books, less than 10% of them would eventually be bulldozed.
"If the property is in extreme disrepair, where it is a blight on the neighborhood or a safety hazard, demolishing it can be seen as an improvement to the neighborhood, like pulling a bad tooth to save the rest of them," Sharga said.
Demolition can be done for between $5,000 and $30,000, depending on the size and type of the structure. Fixing up a blighted home for resale can reach into five or six figures, and when taxes, maintenance and liability costs add up to a continuing loss on a property, the most cost-effective means of disposal is the bulldozer.
"Homes that we demolished are at times listed at values of $5,000, but to bring them up to code and make them habitable could cost $50,000 to repair," said Jumana Bauwens, a spokeswoman for Bank of America Home Loans.
Cities proceeding with demolitions
Demolition of foreclosed homes and other abandoned structures is happening in several U.S. cities. Detroit has a goal of demolishing 10,000 structures by the end of 2013. So far, almost 4,000 properties have been identified, at least 95% of them residential. The properties come into the city's possession through donation, because of delinquent taxes or failure to respond to nuisance-abatement procedures.
Bank of America has said it would identify 100 properties for demolition in Detroit. Rick Simon, a spokesman for Bank of America Home Loans, said homes designated for demolition are donated to public agencies and "generally would require prohibitive costs to make them habitable."
He said the properties are usually under $15,000 in value, costly to maintain or to prepare for sale and are often in areas with many vacant properties, creating blight and hurting surrounding property values.
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Todays housing prices were artificially driven up by the big money boys. Sure, they would agree with destroying the houses. They destroyed the whole Country for greed.
Join hands with those in need and re-build our Country.
You can buy a house in Flint for like 4 grand. They aren't tearing those down; therefore, perfectly good houses shouldn't either. When stuff doesn't sell, you LOWER the price until it does sell. Holy crap, how hard is that? If its torn down, it isn't worth anything!
The housing market has been artificially inflated for years. The manipulation of housing prices is what destroyed the market.
The prices should be lowered until the sells. This can give those who are suffering financially a chance to own their own homes. Our Countrys economy is headed south. Every family should be given the choice to own property, and live in their own home.
The idea of someone suggesting that we destroy a home because of someones having a hard time financially is sick.
Not only should people struggling financially be given a chance to own their own home, the Government should assure that there is financing available. We need to help each other. What have you done lately to help someone make their bills.
We need to start working on the repair of the Family as a unit. Our whole value system is falling apart.
Repair and rebuild the Country.
I can not believe that we, as a Modern, Compassionate People here in the United States are more Satisfied by taking our fellow mans homes by foreclosure and then TEARING said home down! Leaving these people on the streets, helpless and homeless. The people foreclosing on these homes are financed by MY and YOUR tax dollars to be able to kick the same TAX payers out of their homes and tearing them down, helplessly watching their dream and lives crumble before them. WHAT IS OUR COUNTRY COMING TO?? GREED, that is WHAT!!
I am ashamed to be a part of such a system that has absolutely NO Compassion an so much greed for the almighty dollar. Since tearing down the home would be deleting all the assets, LET THEM STAY THERE AND TRY? What would you have to loose?
This article speaks volumes about American values. Let's go into two unproked wars, spend 2 milion dollars a minute and when the economic fall out happens tear down homes and throw people out on the street because banks are losing money. Animals are more humane to one another than humans are in this so called "civil society".
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