That may be the case, but remember that for the most part, that area is usually higher income and family based.

For example, in the area I’m looking at (QC rd and Germann b/w Gilbert and Val Vista), there are several foreclosures which have been sitting there 6-12 months. They’re all in decent shape from the outside, aside from some weed problems.

But as I looked further into Queen Creek, East Mesa, and North Mesa, I found plenty of these homes. Especially north of the 60 where the areas seem to get worse as they get closer to Main St.

I do know, that a/c units have been victimized pretty heavily in the houses I’ve been looking at though. Talking to an HVAC guy working on my neighbor’s house, he has been saying that the rental companies often call him to check up on the units and he confirmed that even the homes I mentioned look fine, but the copper’s gone in many of the A/C units.

So it’s definitely there, you just pick your area. Detroit is definitely no Gilbert

I disagree w/ this statement. When the RE market was booming there was less need to fix-up the house for resale. There was a small inventory of homes available compared to the number of buyers wanting to purchase. Sellers had buyers eating out of their hands. As a licensed RE agent in Las Vegas, NV I saw this first hand.
If you go looking for trash-out houses today…sure, you can find them. However, it is also very easy to find houses that are in excellent condition as well.

I have been showing almost nothing but Foreclosure/REO properties in Chandler/Gilbert AZ, and most of them are in pretty good shape. Sure you see some used carpets, or paint that needs touching up, some yards that are behind on care, but all in all, just a little work and 2 or 3K from perfect. I have only seen one or two out of hundreds that are actually trashed.

Watch out for those granite countertops
http://www.nytimes.com/2008/07/24/garden/24granite.html

Almost every re-possessed house I entered in last 6 months has appliances removed, sometimes the sinks and bathtubs, showers, lighting… some have the wiring removed along with the copper water lines.

I get so angry when I hear about foreclosures that are trashed to the point value has been taken out. To not be able to pay for it is one thing. But to trash it. To take out plumbing and electrical. It just goes to show you what this bubble started. Trailer Trash will always be Trailer Trash. No offense to those who actually live in trailers.

There were actually several of those $1 homes in Detroit and some for slightly more. Did the bank have those homes on their books for a buck? Huh-uh. The false values that the lenders are carrying may be the most under-reported news in America.

I was in Alaska during the last big recession. There were 1200 vacant homes in my area (Mat-Su Valley) and 10,000 people left Anchorage in one year. Malls had no tenants. Apartment buildings had no tenants and I was witness to a true bottom. We aren’t even close.

I have attended many closing where the sellers brought money to close in order to save their credit. Statistically,this gives the false illusion that the home sold at a higher price than actual and does not take into account the capital loss to the seller.

When the bank got it back, the windows & doors were broken / stolen, along with most stuff inside.

They paid a contractor to board up the holes, and someone promptly stole the plywood off the windows & doors!
(this may have happened more than once… I didn’t catch that part)

The bank listed the house for sale for $ 1.00

AFTER 19 DAYS on the market for a dollar, they got a “full price” offer, and the new owner got their house.

(No word on whether it was purchased with a creative, no-doc, subprime, NINJA, reverse amortization loan or not!)

It may just be pessimism, but many might have the opinion that the buyer should have borrowed the dollar. That way if the scraping or repair costs were more than the value, the new buyer could just “walk away.”
Of course, we always have that option available due to property taxes that can be neglected.

As Twist expressed, we have homes in many areas that are “scrapers.” Many add NEGATIVE value due to the cost of removal.

I helped a friend this week to buy his daughter a newly framed up 2300 sq.ft. custom home, windows, doors, roof, exterior sheeting, power and plumbing roughed in and sitting on a beautiful acre for $100K. The builder couldn’t afford to finish the home in this market and was asking $165K two months ago, now he is broke!!

My neighbor had their home listed for $469K and just accepted $354K and agreed to paint the entire interior, and change all the carpet and wall paper. This is a three year old gorgeous custom home.

What Fannie, Freddie and all of the others have for collateral is highly exaggerated. The future bad news will be staggering.

We must all remember that housing is not our only issue, we are in serious recession that will deepen through 2009. As the old showman said, “The monkey’s dead and the show’s over.”

He may be insulated in his little world, but this is also what I’m hearing from agents as well. Some of these places have been gutted to the walls- L was telling me about one foreclosure that would have to be bulldozed. If you are just looking at the numbers without looking at the condition of the property, you might think that values had dropped 75% in the neighborhood- when in reality you are now looking at the value of a nice home vs the value of the land.

The quality of the housing stock is definitely a factor in the falling prices.

I can’t help wondering how insulated a guy like Richard Smith is with yes-men/women all telling him that everything is fine. I can tell you where Realogy is located down the road from me in NJ, RE values have not dropped as precipitously as in AZ or NV. However, I get the feeling the other shoe is about to drop in this region due to the contagion effect in the finance industry. As one of your sidebar stories discusses the lack of capital is going to force interest rates up independent of the Fed actions and this will eat into the bottom line.