The Housing Bubble

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9 news reports from Colorado. “From the outside, it looks like any other foreclosure. The home on the 15000 block of Atlantic Place in Aurora has a ‘for sale’ sign in the yard and the front door is littered with notices. But when Efrain Diosdado opens the gate to the backyard, it really tells the story of how long the home has been vacant. As the crew headed by Diosdado starts working through the weeds, they discover a number of tires, an old air conditioning unit, three grills and an untold amount of trash. They have to clean it all up before they can even attempt to mow the grass that now looks like a jungle. ‘Looks like a forest back here,’ he said of the 3 to 4 foot weeds.”

“Since 2009, the city has required and charged banks to register foreclosures and clean them up. 3,700 homes have been registered. Right now 1,300 are on the list. John Knight lives near the home Diosdado’s crew was cleaning up. He says it has been empty for about a year. Knight, a long-time resident who is also looking to sell his home soon to downsize, says he was excited to see the city clean up the property. ‘It’s been looking bad for quite some time,’ Knight said. ‘It’s really discouraging, because you do take pride and ownership of a house, it’s a small cul de sac. When you have one house not very well taken care of, it depreciates the entire neighborhood. It looks great now.’”

In Denver Times from Colorado. “The number of homeowners in Colorado in active trial modifications – the first step in the federal government’s $75 billion plan to keep people out of foreclosure – has dropped by almost half since the beginning of the year, shows an InsideRealEstateNews.com analysis. Zachary Urban, spokesman for the Adams County Housing Authority, said that the ‘most critical aspect’ of the drop in trial modifications is the rules change that requires lenders to be more selective in letting consumers into the program. ‘That has punctured the bubble, if you will, of home modifications,’ Urban said.”

“And that is a good thing, he said. ‘We saw this rise in trial modifications and it was just not sustainable,’ Urban said. While it may seem like bad news to homeowners who would love to lock in rates as low as 2 percent, it often is not in the best interest of the homeowner, he said. ‘The way we look at it is why give more money to the mortgage company when it is a losing proposition?’”

The Prescott Daily Courier in Arizona. “A homebuilder in Dewey-Humboldt finished 75 percent of a house before losing it to a bank, according to Gregory Arrington, the town’s code enforcement/community outreach coordinator. Arrington said a disposal company removed a 5-ton roll-off container from the site and dumped the trash in the rear of the property. However, as many as four months passed by before the complaint reached the hearing officer, Arrington said.”

“Code enforcement violations have become more common since the housing market collapsed a few years ago, Arrington and other code enforcement officials from the tri-city area said. It becomes a challenge to track down ownership, and no one takes responsibility for maintaining homes, swimming pools and yards, said Boyce Macdonald, Yavapai County land-use manager. ‘When they are absentee (-owned), it is harder to get information because they are in Dallas, Texas, or California,’ Macdonald said.”

“If Code Enforcement Supervisor Fernando Gonzalez’ staff learns a property is in foreclosure, ‘We have to stop our process against the property owner and go after the (lending) institutions,’ Gonzalez said. ‘It is usually the bank. And we have to re-initiate the notice of violation against the bank. We have to start all over. Sometimes, the property is in limbo’ because a bank has not assumed possession of a foreclosed house.”

The Arizona Daily Star. “From the street, at least, Robert and Shannon Vigil’s old home looks great. But look over the backyard wall, or venture inside, and it’s easy to see that nearly two years of vacancy has taken its toll. Vandals have trashed the home, breaking windows, dumping mattresses into the backyard, throwing beer bottles into the pool and even stuffing the toilet with crossword books. ‘I just couldn’t believe that anyone would be so disrespectful,’ Shannon Vigil said. ‘But at the same time, the bank, they basically allowed it to happen by not taking the house when we told them we were leaving, by not working with us when we were trying to save the house.’”

“United States Postal Service data show about 120,000 vacant housing units across the state, said University of Arizona economist Marshall Vest. Of those, about 25,000 units are in the Tucson metro area and 90,000 are in the Phoenix metro area. The data track previously occupied units that have gone without mail delivery for 90 days. ‘If anything, I would think those numbers understate the idea of vacant houses,’ Vest said.”

“What bothers the Vigils, who were extremely upside down on their home, is that they tried to pursue a modification and then a short sale at about $155,000 before walking away and filing for bankruptcy. To see the house sit and get trashed nags at them because it feels like a waste. ‘Basically, they don’t want to lose any money,’ Shannon Vigil said. ‘Well, hello, the house has been sitting vacant for two years. You’ve lost plenty of money.’”

“Developer Michael Ingram, of El Dorado Holdings, took an interest in Maricopa back in the ’80s, buying up 18,000 acres, often for as little as $500 a pop. He developed the town’s first subdivision, Rancho El Dorado. ‘We’ll be bringing something on the market that’s far below the southeast Valley today because prices are so much lower’ in Maricopa, he told the Phoenix Business Journal in 1996, when Maricopa’s population was about 600.

“Ingram’s vision was simple: expand the drive-till-you-qualify ring. And people bought into that vision, flocking to his lower-priced homes. At the peak, Maricopa grew by nearly three people an hour. The downturn has left Maricopa unfinished. There’s nothing to do, and nowhere to go. ‘If we had something to offer other than cheap housing, we would be a much more attractive city,’ said Maricopa resident Heather Susoreny, who commutes about 100 miles round-trip to her job in Phoenix.”

“Susoreny put $180,000 down on her house in Maricopa and has watched it disappear with sinking home values - she calls it her ‘ghost money.’ She’s watched other homeowners walk away, and she said she vacillates between being ‘pissed off and acceptance’ of the situation. She used to follow news about the housing crisis and track sales, but all of that made her feel crazy. Now she just tunes it out. Still, she said, she likes living in Maricopa. She’d like to wait it out, she said - until she can get at least a tenth of her ghost money back.”

“On weekends in the city of Maricopa, signs of the housing crisis come to life. Sign spinners line the main road in and out of this foreclosure mecca, pointing the way to bank repos, cheap homes and ‘final opportunities.’ Like much of Pinal, foreclosures are king in Maricopa. Distressed homes made up 80 percent of sales there at the end of last year - and that’s an improvement from when things were really bad. The median sales price has fallen from $260,000 in 2006 to about $110,000.”

“‘There’s an identical model next door selling for half the value that I paid for this house,’ said Marvin Brown, a Maricopa city councilman who bought in Pulte Homes’ Cactus at Senita subdivision for $325,000. ‘Half the value. That’s painful. That’s like Mike Tyson hitting you in the jaw in his best days.’”

“Pinal County is a lunar landscape of unfinished developments where streets dead-end at dirt, playgrounds were built for neighborhoods that don’t exist and vacant model homes idle in the dust. ‘We bought here because it was a place that was affordable. We couldn’t afford anything in Gilbert or Chandler or anywhere close to work,’ said Jon Cox, who lived in unincorporated Queen Creek for five years. ‘And we liked it out here at the time. It was new.’”

“Cox made those comments in March when foreclosure was looming large. He lost his home in May, and has since put Pinal in his rearview mirror, moving his family to Gilbert, where he rents. ‘For losing the house,’ he said, ‘I feel like I am a number.’”

The Salt Lake Tribune in Utah. “After years of strong sales and of owners using their homes as ATMs — only to see it all come falling down in the biggest housing crash in recent memory — it has come to this. If you want to get a home in trouble sold in today’s market, there’s a strong likelihood you’ll have to go through the complex, time-consuming short sale route to get it done. In Salt Lake County nearly one-quarter of all residential listings are short sales.”

“Jeremy Stroup of West Jordan, who purchased his three-bedroom, two-bath rambler in a new subdivision in 2007 for $362,000. He has watched it fall in value by more than $100,000, and after a divorce late last year, Stroup began to worry not only about how under water his home was, but about making mortgage payments over the long term on only his salary. After efforts to work with his lender on a loan modification failed, Stroup opted for the short sale route. Months later, the bank has approved a selling price of about $250,000, and he could be out and living with his mother by the end of the month.”

“Although there’s some relief he will soon move past his predicament, ‘there is definitely disappointment and stress in losing your home,’ he said.”

“Realtor Mary Olsen specializes in short sales. Olsen says she’s no longer surprised when a home has not one, but two or even three mortgages. In Riverton, she shows a home that’s part of a deal complicated by the fact that two banks are involved. ‘A few years ago ‘everybody was using their homes as an ATM machine,’ taking out home-equity loans to buy new cars, motor homes, new furniture.”

“Although the owner is upside-down on her mortgage and wants out, and buyers have made offers, Olsen has yet to get both banks to agree on a selling price. So she waits.”

“The recession has delivered a blow to commercial banks in Utah that, in addition to costing thousands of jobs and destroying several institutions, will affect the availability of real estate loans for years to come. ‘When it comes to real estate, the bar will simply be much higher,’ Howard Headlee, who leads the Utah Bankers Association, said late last week. ‘Where in the past, a lot of the risk was pushed onto the bank because, frankly, no one thought there was a risk, that risk will be put back on the developer,’ Headlee said.”

“Banks foreclosed on real estate-related loans valued at $33 million in the first quarter 2007. The figure ballooned to $613 million in the first quarter 2010. The foreclosures resulted from defaults by borrowers who used property as collateral. ‘These numbers reflect just how serious this episode has been, and I think reflect just how close we came to a significant catastrophe,’ Headlee said. ‘Clearly, this was what I hope will be the most significant economic event of my lifetime, and it never happens again.’”

The Deseret News in Utah. “Saratoga Springs’ population is now 13 times larger than it was just a decade ago. Nearby Eagle Mountain grew eight-fold. Herriman quintupled. Lehi more than doubled. Those are examples of explosive population growth in northern Utah County and southwestern Salt Lake County, according to U.S. Census Bureau estimates.”

“Nicole Martin, economic development director for Herriman, said growth came early in the decade because credit was easy, and that helped people afford the large tracts and large houses offered at the time in Herriman. Many of the homes then were in the $400,000 to $500,000 range. ‘It will be interesting to see in the 2010 Census how many of those (new suburban) houses (built when credit was easy) are vacant and how many are occupied,’ said University of Utah research economist Pam Perlich. ‘The census uses housing counts as a cornerstone of its estimates. But the beginning of the decade was much different than the end.’”

In Business Las Vegas from Nevada. “In its analysis of the Las Vegas housing market, the Center for Business and Economic Research maintains any recovery is threatened because there’s an excess supply of housing units compared with the demand. Although foreclosures are trending downward for now, there is concern the problem could worsen, said Mary Riddel, the center’s interim director.”

“One bright spot in the Las Vegas housing market is that prices have stabilized. But people shouldn’t get too comfortable with what that means, she said. ‘This could be a sign that housing prices have finally reached their bottom and that a recovery in the housing market is around the corner,’ Riddel said. ‘A closer inspection of some fundamentals of the housing market may suggest otherwise.’”

“The center estimates an excess of 9,000 vacant housing units over the normal local housing inventory. That is about two-thirds apartments and one-third single-family homes, economists said. With 9,000 more homes and apartment units than needed, that means the population has to increase by 22,500 before there is a balance between supply and demand, Riddel said. That doesn’t count in any homes that are being built, she said.”

“Another factor threatening any recovery of the housing market is the potential for strategic mortgage defaults from homeowners who are underwater, Riddel said. Las Vegas leads with the nation with about 75 percent of its homes underwater compared with 24 percent for the nation as a whole, she said. She said another threat to the housing market is the resetting of mortgages over the next two years that will lead to higher interest rates and therefore payments. That will create even more underwater mortgages.”

“‘Unless a quick turnaround in the local economy occurs, which is not very likely, this scenario will ultimately produce a new wave of foreclosures in Southern Nevada,’ Riddel said.”

8 News Now in Nevada. “Nevada is one of five states that will get more than $100 million to help with the housing crisis. It is part of the so called ‘hardest-hit fund.’ In Clark County, underwater home mortgages amount to $44 billion.”

“If you qualify, the state is also providing allowances to cover fees for appraisals and moving, even giving a legal allowance for up to three months. But, there is a lot of fine print and only a fraction of frustrated borrowers may even qualify. Also, your bank or credit union must be on board first. ‘The only way these funds will go as far as we hope they can is if the banks step up and match the deductions in principal, dollar for dollar,’ said Lon DeWeese, Nevada Housing Division.”

“While a lot of homeowners want this money, not everyone will qualify. The foreclosure prevention program is designed to help families in states hit hardest by the housing downturn. With housing prices here plummeting, and families unable to pay their monthly notes, the government hopes it will bring much needed relief to homeowners who’ve exhausted their options.”

“‘I went to my bank to try to get modifications. I went through the government programs, through Fanny Mae, Freddie Mac, and I went through the 888 housing help line on the Nevada foreclosure site,’ said Georgia Richardson, who is now selling her home.”

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This thread will be forwarded during my trip through Maryland, Virginia and DC for the purpose of communicating with local bloggers, posting observations and photos. Let’s call this the Shadow Inventory Tour. Pics will be posted on Picasa.

The Baltimore Business Journal in Maryland. “Barbara Hughes can breathe a little easier these days, but the shock of what she has been through will not so easily fade from her memory. Bank of America has agreed to reduce her monthly mortgage payments and allow her and her sister’s four children to stay in their Baltimore County home. Rick Davis, a housing counselor at the Eastside Community Development Corp. Davis was able to connect Hughes with an official at the bank who was willing to call off a planned foreclosure of her home. But like many of the homeowners he counsels, Davis feels under water these days. His ability to help others is far outweighed by the amount of need for his aid. For every Barbara Hughes he encounters, there are many more who either won’t seek help or just can’t be helped.”

“Joseph T. Landers III, executive vice president of the Greater Baltimore Board of Realtors said he is deeply concerned about the ’shadow inventory’ in Greater Baltimore’s housing market, those properties that are at risk of foreclosure or have been seized by banks but are being withheld from the market for a future date. When those properties start to come back onto the market, they will likely be resold for far less than previously. That means a home that sold two years ago for $400,000 might only fetch $200,000. That reduction means even more people will be under water, owing more on their mortgages than their properties are worth.”

“Maryland ranked as the 10th worst housing market in the nation for foreclosure events in May, according to RealtyTrac. There were 5,852 properties facing or in foreclosure in May, 65 percent more than in May 2009. What’s more, RealtyTrac researcher Daren Blomquist said that there could now be a second wave of foreclosures as the housing market shows signs of improvement. About 2,400 homes sold in Greater Baltimore in May, up nearly 26 percent from May 2009, according to Metropolitan Regional Information Systems Inc. of Rockville. As activity picks up, Blomquist said, banks are more inclined to foreclose on a property because they have a better chance of being able to resell it.”

“‘You’re definitely not out of the woods yet,’ Blomquist said.”

The Frederick News Post in Maryland. “Montgomery County had 467 foreclosures in May, and Washington County 163. The highest in Maryland in May was Prince George’s County with more than 1,700 foreclosures, followed by Baltimore city with 847. ‘The increase in foreclosures from last year will have the effect of lowering property values because the banks are interested in a quick sale and getting these foreclosure properties off of their books and are substantially discounting their foreclosure resale homes for sale,’ said Patrick F. McLister, a partner in the law firm of Salisbury & McLister.”

‘Without the tax credit, it remains to be seen whether the real estate market will now be able to absorb the number of foreclosure resales coming on the market without negatively affecting the typical non-foreclosure sellers during this prime selling season,’ McLister said.”

“Carlton Boujai, treasurer of the Maryland Association of Realtors and an agent with Exit Realty Prosperity Group in Frederick , said he sees some positive indicators, but is cautious. ‘Foreclosures are down, short sales are down, properties are spending less days on the market,’ Boujai said. ‘But economists are saying there could be another wave of foreclosures.’”

The Daily Press in Virginia. “Marshá Smith thinks she can afford a home priced at up to $150,000. ‘If I don’t qualify for how much I want, I’ll keep pursuing it, maybe getting rid of some debt that I have that will eliminate extra money that I’m spending out,’ the 36-year-old Hampton resident said. ‘But I’m not going to let it defer me from my dream.’”

“Only about 18 percent of the homes for sale in Hampton Roads fall below $150,000. In fact, nearly two-thirds of the homes currently listed for sale are priced at more than what the median household income in the region can comfortably afford. James V. Koch, economist and president emeritus of Old Dominion University, said those income and home price numbers mean that it’s a good time to think about buying. The percentage of median household income used to pay for a median resale home has fallen every year since 2006, according to the Old Dominion University’s Economic Forecasting Project. It’s estimated to drop to 23.2 percent in 2010, from the recent high of 33 percent in 2006.”

“‘The problem is people don’t have jobs or they’re scared,’ Koch said. ‘They’re reluctant to buy a house, or banks are reluctant to lend.’”

“Or they don’t qualify for a loan. ‘Underwriters and investors are looking harder at loans than ever in the past,’ said Robert Runnells, production manager of Old Point Mortgage. ‘They’re more restrictive. They’re just more guarded and, with all the foreclosures, rightly so. Consumers have to jump through more hoops than they used to. We see a lot of people now with a higher debt load and less assets than we’ve ever seen.’”

“Smith has always wanted a walk-in closet, and thinks it would be nice to have side-by-side Jacuzzi tub and shower. Her first home probably won’t have all that, but there’s hope, she said. She’s just ready have a home to call her own. ‘Paying rent each month is a waste,’ Smith said. ‘It’s just throwing your money anyway and never really owning anything for yourself.’”

The Star Exponent in Virginia. “Foreclosures and other distressed properties continue to comprise the largest share of real estate transactions in Culpeper County, and the market, though not stagnant, is weaker than last year. From January to April, 112 properties – 75 houses and 37 house lots – went into foreclosure. In the first four months of last year, that number was 187, according to an analysis of county tax records. Like in past years, many of this year’s foreclosed homes occurred in the newer housing developments around town.”

“Last year, Sam Aitken, director of a homelessness intervention group that has also provided housing counseling said he spoke with probably 1,000 local clients in some sort of housing distress. Their top concern? ‘That the banks won’t work with them,’ he said, noting that most of the foreclosed properties in Culpeper were mortgaged through national banks and not local ones. ‘The incomes are way down,’ said Aitken, who’s worked in housing intervention in Culpeper for 20-plus years.”

“Culpeper Realtor Beverly Herdman with Keller Williams Realty said the first quarter of the year resulted in a “more balanced” market, with 118 homes sold in Culpeper. Of those, 39 percent were traditional sales, 35 percent were foreclosures and 26 percent were short sales. ‘That is great news, but we are not out of the woods yet,’ said Herdman. ‘If you look at the total of foreclosures and short sales, distressed properties are still making up 61 percent of the market sales for the first quarter.’”

“The first quarter of 2009 saw 136 home sales in Culpeper County, she said, noting 18 percent were traditional sales, 71 percent were foreclosure and 11 percent short sales. Typically, once a home goes into foreclosure the bank is not interested in negotiating further. Now is a great time to sell, according to Herdman, saying the housing inventory in Culpeper is way down. ‘With a lack of inventory and the homebuyers’ tax credit through the end of April, it created quite a frenzy with multiple offers and homes being over bid,’ she said.”

“Now that the tax credit deadline has expired things have cooled down. ‘We have noticed that there has not been much of an urgency with multiple offers,’ Herdman said. ‘Buyers are still frustrated with the lack of inventory. Now is definitely a great time – we need more inventory on the market.’”

The Washington Examiner. “It will take nearly three years for the Washington area’s pent-up delinquent and foreclosed properties to clear, according to a recent report, casting a pall over the region’s housing market. The area’s 34.2 months of inventory is in line with the national average, said the report from Standard & Poor’s. Analysts have kept a close eye on the so-called “shadow” housing market, which is comprised of homes that are delinquent or in foreclosure but have not been put on the market.If banks or lenders release them too soon, home prices could crash; if they hold on to them too long, supply could dry up. ‘The longer the overhang … the longer it is until the market returns’ to a healthy level, said Diane Westerback, managing director of Global Surveillance Analytics for Standard & Poor’s.”

“‘It’s hard to say exactly how these things get liquidated,’ she said. ‘Inevitably they’re going to get spread out a bit.’”

“David Dowies, principal broker at Portfolio Realty, a real estate firm based in Northern Virginia, said he has seen the properties ’starting to trickle out’ back onto the market. Lots of clients want to sell, he said, but short sales and foreclosures that have pushed prices down have given some of them pause. ‘There’s just a lot of people on the sidelines — sellers — that have been holding back,’ he said.”

The Washington Post. “After the bank foreclosed on Fernando Palacios’s Gainesville home in March, he thought he was done with what he described as the most stressful financial situation of his life. The bank sold the home for far less than Palacios owed on it, as often happens with foreclosures. What Palacios did not see coming was the letter from his lender demanding that he pay the shortfall: $148,064.02.”

“‘I really thought I was through with this house,’ said Palacios, who fell behind on payments when the economy soured and his cleaning business stumbled.”

“Palacios said he was committed to staying in his house, which he bought in 2005. He sunk $20,000 into improving it and hoped to raise his children there. But his lender refused to modify his loan, he said. To avoid personal liability for the deficiency, Palacios is filing for bankruptcy protection, as many people do who are in similar situations, said Nancy Ryan, his bankruptcy attorney.”

“‘I am definitely seeing more people come through my door who walked away from houses a year or two ago and thought they were as free as the dead,’ Ryan said. ‘They’re stunned when they realize they’re not.’”

“Gretchen Somers said she and her husband understood the risks last year when they completed a “short sale,” a transaction that allowed them to sell their Manassas home for about $150,000 less than they owed on it. But they felt they had no other options. In hindsight, Somers said she and her husband should have just walked away from the house.”

“‘We took care of the house because we wanted it to sell,’ Somers said. ‘If they were going to come after us anyway, we shouldn’t have done them the favor of making sure it looked good and cutting the grass even after we moved out, We should have mailed them the key and said: ‘Here you go.’”

Post off-topic ideas, links and Craigslist finds here.

Post off-topic ideas, links and Craigslist finds here. The Florida/DC meetup link at the forum is here. Click here for the shadow inventory thread.

Please consider signing the Shadow Inventory petition.

Post off-topic ideas, links and Craigslist finds here. The Florida/DC meetup link at the forum is here. Click here for the shadow inventory thread.

Please consider signing the Shadow Inventory petition.

Post off-topic ideas, links and Craigslist finds here. The Florida/DC meetup link at the forum is here. Click here for the shadow inventory thread.

Please consider signing the Shadow Inventory petition.

Post off-topic ideas, links and Craigslist finds here. The Florida/DC meetup link at the forum is here. Click here for the shadow inventory thread.

Please consider signing the Shadow Inventory petition.

This thread will be forwarded during my trip through Florida for the purpose of communicating with local bloggers, posting observations and photos. Let’s call this the Shadow Inventory Tour. Pics will be posted on Picasa.

The News Press. “Some struggling homeowners could get as much as an 18-month reprieve from their mortgage payments when a federal program starts distributing $23 million earmarked for Lee County in a few months. Mike DeGregorio, who bought his Cape Coral house in 2006 for $211,000, said he hopes to take advantage of the program. The house is appraised at only $38,000 by the Lee County Property Appraiser’s Office, but DeGregorio said he’s recovering from losing his electrician job as well as rotator cuff and back injuries.”

Now, he’s working but still still having trouble with his mortgage. A neighbor urged DeGregorio to simply walk away from the mortgage and live free for a year before losing the house in foreclosure. But he doesn’t want to do that. ‘I wasn’t brought up that way,’ DeGregorio said. ‘I have children, I want to live in my house.’”

The Tribune. “Dr. Jacob Siwek became disabled after he fell walking his dog in 2006. His wife stays home to care for him. The couple is left to rely on disability checks of $1,035 a month and then another $360 in food stamps. In 2007, the home Jacob bought in 1981 went into foreclosure. Their monthly mortgage is $1,400 with an interest rate of 10.55 percent. ‘I worked hard throughout my life, I paid taxes and everything,’ Jacob said. ‘So where is my government now? Why won’t they help me?’”

“As of May 31, 2010, there were 329 foreclosures in the city of Sunrise. Christel Wright, who lives four houses down from the Siweks, is also in foreclosure. She told the Commission that her husband was laid off and she is the sole provider of income. She fears that she won’t be able to keep a roof over her young son’s head. ‘I have a new address, 2006 Honda Accord,’ she said.”

“Mario Garcia, a friend of the Siweks, also attended the meeting and has helped raise awareness regarding foreclosure. A neighbor he knew for 15 years suddenly disappeared, and he found out they were kicked out of their home and left silently. ‘It’s just going to get worse and worse. In walking around the last few days…I must have seen 15 homes that were empty. You look in the window and there’s nothing there,’ he said.”

The Palm Beach Post. “Three years ago, Loxahatchee resident James Gamble was preparing for retirement. His home was paid off, he wasn’t married, and he has no children needing an inheritance. So to finance his retirement - and a summer home in West Virginia - Gamble took out a reverse mortgage, getting about $200,000 out of a house he paid an estimated $85,000 for in 1994.”

“‘I would get Social Security and I had enough to live on and pay my bills, but I couldn’t have bought a house in West Virginia for sure,’ said Gamble, 65. ‘I didn’t want to retire and just do nothing.’”

“Nearly 11,000 Floridians lost their homes to bank takeover in May, a whopping 81 percent increase over the same month last year and an indication that loan modification programs are failing, some economists say. In Palm Beach County, the number of homes lenders repossessed last month was 824, six times the amount in May 2009, according to a report.”

“Coral Gables real estate attorney Rashmi Airan-Pace said new Web-based foreclosure auctions in Palm Beach, Broward and Miami-Dade counties are allowing banks to get speedier sale dates. ‘It’s not good for the borrowers,’ she said. ‘A lot of homeowners acted in good faith on trial modification agreements, followed the rules, and all of a sudden they’re denied.’”

The Associated Press. “Imagine going to a house or condo you own and finding a stranger living there who claims the property no longer belongs to you. It’s happening across Florida and other parts of the country through what authorities say is abuse of a centuries-old concept known as adverse possession. In Broward and Palm Beach counties alone, adverse possession claims have been filed on some 200 homes in recent months. Three of the four people behind the claims have been arrested, and police are investigating the fourth man, who along with his father, a convicted mobster, tried to take over properties in Hollywood.”

“‘We look at this as another con job, another get-rich-quick scheme,’ said Don TenBrook, a Broward state prosecutor of economic crimes. ‘You’re starting to see them pop up all over the place. It’s been spawned by the real estate crisis.”’

“Mark Guerette of Wellington, filed notice in official county records that he was taking possession of 100 homes in Broward and three in the Palm Beach community of Lake Worth through Saving Florida Homes Inc. and two other companies. On one day last November, he filed takeover notices on 10 condos in the same North Lauderdale complex records show. Police say Guerette rented out six of the properties and collected more than $20,000 from tenants before he was arrested in April. He has pleaded not guilty to a charge of organized scheme to defraud.”

“His lawyer, Robert Shearin, said Guerette is nothing more than a good Samaritan, rescuing blighted homes. ‘The banks are letting these properties go down the tubes,’ Shearin said. ‘Here’s a guy trying to help out, and he ends up in jail.’”

The Orlando Sentinel. “The Orlando metro area, plus parts of Polk and Volusia counties, has 125 residential projects that have been idle, with no builder activity, for at least a year, a new report shows. Of those, about 15 percent are apartment or condominium projects, while the rest are housing subdivisions, according to Charles Wayne Consulting Inc. of Maitland. ‘Most of the 125 such projects …consist of those abandoned by a previous builder; however, some consist instead of fully developed sites which have never had an active builder … not even the first home built,’ the report states.”

The News Herald. “People planning to build single-family homes are beginning to reconsider as a massive oil slick spreads across the Gulf of Mexico, local builders said this week. The oil spill is hurting an industry already among the hardest hit by the Great Recession. New construction was just beginning to make a slight recovery. ‘I know of at least three projects tabled until this is resolved,’ said local builder Tom Ledman, Home Builders Association of Panama City-Bay County president. ‘Since the oil crisis began, construction has just stopped. If it’s really bad, it will affect all the tourism in Bay County. Ultimately, that will affect housing as well.’”

The Naples News. “A Naples beachfront homeowner filed a class-action federal lawsuit Thursday seeking at least $5 million from BP and others to reimburse Florida homeowners affected by the Gulf of Mexico oil spill. Cynthia Joannou, trustee for The Cynthia Joannou Revocable Trust, filed her lawsuit in U.S. District Court in Fort Myers. Joannou, a North Naples Realtor who sells properties in Collier and Lee counties, also alleges buyers of coastal homes are watching the growing oil slick and asking for guarantees before purchasing homes, while some Realtors are offering oil-spill addenda allowing contract cancellation or a delay of closings up to 30 days if signs of the spill show up within 48 hours of a closing.”

“Joannou, a Gulf of Mexico beachfront property homeowner, has a home on Lely Barefoot Beach in North Naples. Records show she purchased the Jumento Cay Lane house for $372,500 in 1997. Real estate ads show Jumenta Cay Lane condos are listing for $3.4 million. Property records show the most recent sales were $4.3 million in December and $3.4 million in April 2007. Joannou’s home was last listed for sale in 2003 and the listing was extended several times before it expired in July 2006.”

The Herald Tribune. “The Justice Department announced Thursday that it has arrested 485 people across the nation in a mortgage fraud sweep, though no charges were brought against anyone in Manatee, Sarasota or Charlotte counties. An effort similar to the so-called Operation Stolen Dreams occurred two years ago, when the agency and the FBI announced widespread arrests of more than 400 people.”

“It was not until the following month that federal prosecutors moved against Sarasota real estate investor Neil Mohammad Husani, indicting him and three partners on charges of mortgage fraud and money laundering. Criminal attorneys and other observers expect a similar pattern this time. ‘The FBI tends to make a big splash in major media markets first. I’m sure investigations are proceeding in Sarasota. They may just may not be as far along,’ said Jack McCabe, a Deerfield Beach real estate consultant.”

“After a year-long investigation, the Herald-Tribune reported last summer that at least 37 separate groups in Sarasota and Manatee counties were involved in artificially inflating the value of real estate. They sold properties to associates at higher prices to get more loan money than would have been otherwise possible. All told, the groups defaulted on more than $450 million in loans. There is no doubt that more players will be arrested in Southwest Florida and across the state, said Daniel Castillo, a Tampa lawyer who defended one of the members of Husani’s circle.”

“‘I would be shaking in my boots right now,’ Castillo said. “There is no way these people will be able to get away with what they did. They crippled the nation.’”

The St Petersburg Times. “Sang-Min Kim, a tattoo parlor owner who made a fortune flipping homes at the height of the real estate boom, was indicted by federal officials on Wednesday and charged with money laundering and conspiracy to commit wire, mail and bank fraud. A six-page indictment by the U.S. Attorney’s Office accused Kim of operating a far-reaching scam that involved numerous buyers, sellers, lawyers, banks and real estate professionals. The multimillion dollar scam was first revealed by the St. Petersburg Times in 2008 as an example of how mortgage fraud contributed to the Tampa Bay area’s housing collapse.”

“The indictment said Kim flipped about 100 homes between January 2005 and October 2008. Of those transactions, 80 involved fraud that cost lenders about $6.4 million, the indictment stated. ‘It’s one of the biggest and one of the more significant mortgage fraud cases we’ve done in the last year,’ said Steve Cole, a spokesman for the U.S. attorney for the Middle District of Florida. ‘There’s a conspiracy there, so we’re not done.’”

The Wall Street Journal. “Housing markets that have escaped the brunt of home-price downturns may not be home free. A new report shows that the ’shadow inventory’ of homes, with delinquent mortgages that have yet to go through the foreclosure process, is growing fastest in areas that have so far avoided the biggest home-price declines, according to a report by ratings agency Standard & Poor’s.”

“Mortgage companies could be forced to reduce their prices on these foreclosed homes as they work through that supply, and as more of those homes sell, that could continue to put pressure on prices. At the top of the list: the New York City area, where at the current rate it would take 103 months to clear the shadow inventory of loans that are more than 90 days delinquent or in foreclosure.”

“After the New York region, Miami has the largest backlog with a 62-month supply. But unlike New York, Miami’s shadow inventory has fallen from its March 2008 peak of 129 months. New York’s backlog has held at more than 100 months since early 2008. The biggest increase in shadow inventory came in Dallas, which had a 43-month supply, up from 19 months in September 2008. Other cities with big increases in recent months include Atlanta, Boston, Denver and Charlotte. Shadow inventory has remained elevated, but hasn’t increased much, in both Seattle and Portland.”

“Nationally, foreclosure timelines have swelled over the past two years as lenders deal with rising piles of delinquent loans and as they are under pressure to modify those loans and avoid foreclosures. But so-called ‘judicial’ states that require banks to get a court order in order to foreclose, including New York, New Jersey and Florida, have seen foreclosure timelines grow even larger.”

“‘The big problem of course in the New York metro area is that we have not had the re-pricing that the West Coast has had,’ says Daniel Alpert, managing partner at Westwood Capital LLC, an investment fund. ‘This is very similar to what happened in the early 90s where the crisis moved regionally from one area to another.’”

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