Apr 5, 2013 | Natural News | J.D. Heyes
Once upon a time, home ownership was considered the American dream, but since the Great Recession of 2008-2009, triggered by the bursting of a real estate budget a former Reagan budget official says was brought on by poor legislation and shady Fed practices, it has become more of a nightmare.
More than 300,000 "zombie" homes - those which have been foreclosed upon and abandoned by their owners - are now sitting idle across the country, and with low economic growth, sustained high unemployment as well as underemployment, the housing situation is not liable to improve anytime soon.
A national survey found 301,874 "zombie" properties dotting the U.S. landscape in which homeowners in foreclosure have moved out, leaving vacant property susceptible to vandalism and degradation.
Topping the list is the Sunshine State: Florida has some 90,556 zombie properties containing vacant homes in foreclosure, according to a foreclosure survey released March 28 by RealtyTrac, a real estate information company based in Irvine, Calif.
Following in a distant second and third place are Illinois and California respectively, with 31,668 and 28,821 properties on the foreclosure list.
A pretend housing recovery for a pretend economy
Though the Obama administration has been reporting that the housing market is improving, the facts refute such claims.
"The number of homes overall in foreclosure or bank-owned rose by nine percent to 1.5 million properties nationally in the first quarter of 2013 compared to a year ago, according to RealtyTrac," Reuters said.
What's more, according to RealtyTrac VP Daren Blomquist, a tidal wave of homeowners are at risk of losing their dream. He says nearly 11 million more nationwide are at risk because they simply owe more than their property is worth.
Blomquist's firm, for the first time, analyzed data on zombie properties following a special report from Reuters in January of this year examining the special, and growing, problem of zombie property titles, he said:
Reuters revealed the plight of people who walked away from their homes not realizing that their names remained on the deed and that they were financially liable for taxes and other bills related to the abandoned property.
In a number of cases, the news service reported, homeowners abandoned their property after receiving a notice it would be put up for foreclosure sale, only to find out some time later that the bank holding their lien never actually followed through.
And abandoned homes begin to resemble abandoned lots, factories and stores: They deteriorate into eyesores and become havens for criminal activity.
There are a few ways to read into RealtyTrac's data. While Florida has the largest number of zombie properties, the state of Kentucky actually has the highest percentage of zombie properties. Though Sen. Rand Paul's state has fewer than 1,000 zombie properties, they represent 54 percent of the total foreclosure inventory, Blomquist said.
Elsewhere - Washington state, Indiana, Nevada and Oregon - zombie properties constitution 50 percent or more properties in foreclosure, the report said.
Not much improvement
Blomquist said zombie property numbers could actually be higher that what is reflected in the report because researchers used a conservative methodology to estimate the actual number of foreclosed homes:
In Florida, for example, the company does not count any property that has been in foreclosure longer than the state average of 853 days and for which there has been no significant recent activity. The report also does not take into account cases in which a bank chose not to follow through on a foreclosure judgment, leaving the property in limbo.
The RealtyTrac VP said Florida's lengthy average foreclosure time most likely has contributed to the higher number of zombie properties because over time, owners simply give up on the home and just walk away.
He also said while a housing recovery may be underway (though it is obviously not widespread), a full, real recovery has yet to take hold - meaning housing growth is occurring, when it occurs at all, in spite of the administration's current economic policies.
"I think the empty foreclosures is less of a long-term threat but it certainly is affecting individual communities and neighborhoods," Blomquist said.
Welcome to the new normal in home ownership.