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Sunday, October 21, 2007WaPo: Vultures Are Circling Over Distressed PropertiesKenneth Harney over at the WaPo discusses grave dancers, or businesses who swoop in and buy once overpriced homes for $0.50 on the dollar: Subprime mortgage delinquencies and foreclosures are swelling those numbers significantly, he said, along with plunging prices in some local areas. Softening markets also are driving down the expected discounts on troubled houses. Whereas in past years, "we might offer 65 percent of a property's expected value after repair, now in some places we're looking at 50 percent," Hayes said.I have remarked before to friends and family that I do not believe the "bubble burst" will last for long, precisely because these investors seem so willing to swoop in and take advantage of the current turmoil. Why are they so confident? Consider what homes were selling for one year ago... and people were paying then... The real danger is the folks trapped by the real estate market: loans they thought (or were told) they could pay for and a mortgage industry willing to lend to virtually anything that could pay. The public mood during the '00s could arguably be compared to stock trading in the 1920's, junk bonds in the 1980's, any dot.com startup in the 1990's, and so forth. The good news is the housing market will inevitably rebound. The bad news is that millions of Americans will undoubtedly feel as if they were taken advantage -- rightly or wrongly.
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JEFFERSONIAD POLL: Whom do you support for Virginia Attorney General?1) John Brownlee2) Ken Cuccinelli AboutShaunKenney.com is one of Virginia's oldest political blogs, focusing on the role of religion and politics in public life. Shaun Kenney, 30, lives in Fluvanna County, Virginia.ContactThe Jeffersoniad
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