Nurturing Neighborhoods

Since the financial meltdown of 2007 and into 2008 I have noticed something that is quite disturbing.  Prior to 2007 there were distinct neighborhoods where homes held their respective values and one could be assured that unless there was some huge national employment crisis or natural catastrophe, the homes would continue to slowly but surely increase in value accordingly. With that said, I find that since there were so many people who received mortgages but really shouldn’t have due to the loose credit requirements, many of those people found they really couldn’t afford the homes and indeed had not even a clue about taking care of their real estate investment. I drive thru neighborhoods now that have had too many bank foreclosure sales which were purchased at huge discounts from what they originally sold for. What’s most disturbing, is that many of them sold to investors who purchased them to be used as rental properties.

In real estate law, block busting is illegal. In my opinion, the bank and government owned properties are busting the values in neighborhoods at an alarming rate. This is not just happening in North Iowa, but across the nation. When the savings and loan crisis hit back in the early 1980’s, I did contract work for a regional savings and loan. After many conversations with the real estate owned manager, I finally was able to get him to understand that they had to spend money on their holdings to get optimum price.

Nearly every one I sold for them sold to home owners rather than investors and I might add, the savings and loan experienced a far less net loss on the property because we were able to attract more buyers than the bottom feeding bargain hunters. More work on my part? Yes, but it was worth it because I felt as though I was helping to keep the neighborhoods alive. People believe that they can insulate themselves from market swings by buying in areas where they believe to be above the average reach of a market swing.

Believe me, it can happen in every community. My advice to everyone in North Iowa is to continue to care about their homes as well as what is taking place in their neighborhoods.

Joe Chodur

About the Author | Joe Chodur

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