Just when you think you have already heard all the real estate horror stories, another appears out of nowhere. The census bureau released a report that 18% of the houses in Florida are vacant. Florida is not a small state, and to think that almost one out of every five houses in the state are empty is nothing short of mind boggling.
The hardest hit regions of the state, in particular the area around Naples, have about one out of every three homes empty. The census department reported 32% empty homes in this once red hot real estate market. Experts expect it will take many years for Florida to recover.
Not surprisingly, prices have also plummeted. The median price for homes sold in Florida in January, 2011 was $122,000, and this is expected to go down even further through the balance of 2011 and into 2012.
It is true that Florida has the highest number of empty houses, but there are other states struggling in this regard as well. Arizona is not far behind with 16% of all the homes in the state sitting empty. In Nevada the number is 14% statewide. California is doing better than one might think with a vacancy number of 8% of all homes. Since California has more residents than any other state, however, the total number of empty homes is huge.
If you want to understand a little bit about how the housing bubble was created and then burst, consider a home loan of almost three-quarters of a million dollars to a foreign immigrant who earned $14,000 per year picking strawberries in California. It is clear there were no standards of any kind applied to this loan, which clearly could not be paid back. Why would any lender do such a thing?
To get to the bottom of why such fraudulent loans were made, one has to look to the east, more specially to the big Wall St. firms in New York. For some time they were creating huge amount of money for themselves by buying up mortgages and packaging them together as collateral for bonds. These bonds were manipulated in such a way that even disastrous loans were rated as being very solid investments by the rating agencies. Basically they confused the issue enough that the garbage they were selling had the same ratings as AAA U.S. government bonds. Clearly what they did was bogus. The people who caused the real estate disaster didn't even lose their jobs, much less get tossed in jail. They were bailed out by the government, and millions of others lost their jobs and homes. A very sad story that seemingly has no ending.
The hardest hit regions of the state, in particular the area around Naples, have about one out of every three homes empty. The census department reported 32% empty homes in this once red hot real estate market. Experts expect it will take many years for Florida to recover.
Not surprisingly, prices have also plummeted. The median price for homes sold in Florida in January, 2011 was $122,000, and this is expected to go down even further through the balance of 2011 and into 2012.
It is true that Florida has the highest number of empty houses, but there are other states struggling in this regard as well. Arizona is not far behind with 16% of all the homes in the state sitting empty. In Nevada the number is 14% statewide. California is doing better than one might think with a vacancy number of 8% of all homes. Since California has more residents than any other state, however, the total number of empty homes is huge.
If you want to understand a little bit about how the housing bubble was created and then burst, consider a home loan of almost three-quarters of a million dollars to a foreign immigrant who earned $14,000 per year picking strawberries in California. It is clear there were no standards of any kind applied to this loan, which clearly could not be paid back. Why would any lender do such a thing?
To get to the bottom of why such fraudulent loans were made, one has to look to the east, more specially to the big Wall St. firms in New York. For some time they were creating huge amount of money for themselves by buying up mortgages and packaging them together as collateral for bonds. These bonds were manipulated in such a way that even disastrous loans were rated as being very solid investments by the rating agencies. Basically they confused the issue enough that the garbage they were selling had the same ratings as AAA U.S. government bonds. Clearly what they did was bogus. The people who caused the real estate disaster didn't even lose their jobs, much less get tossed in jail. They were bailed out by the government, and millions of others lost their jobs and homes. A very sad story that seemingly has no ending.
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