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I'm sure the cities would be very pleased to take these homes off the banks hands.

I'm not so sure. It means the city has no chance at all of getting property taxes, has to do the maintenance themselves, and can't sell them at what they think is a reasonable price either.

by gk (gk (gk quattro due due sette @gmail.com)) on Thu Jun 18th, 2009 at 04:01:27 PM EST
[ Parent ]
I'm assuming the banks are holding onto the homes and not going through the foreclosure process (people are snapping up homes in foreclosure these days) because the houses still have value. A city couldn't make up the property taxes in 30 or 40 years on what it could make on a house in foreclosure.
by Upstate NY on Thu Jun 18th, 2009 at 04:03:40 PM EST
[ Parent ]
I don' get it: if the banks want to hang on to the houses because they still have value why don't they pay the property taxes and so on?
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Jun 18th, 2009 at 04:15:05 PM EST
[ Parent ]
When banks want to get rid of houses, they put them up in foreclosure sales. If they're not paying property taxes, then they have essentially given the homes over to the city.

So, what we're talking about here then is banks giving homes over to the city. Unless we're talking about totally worthless homes, any city would be glad to take over a home. Even in distressed areas, you can sell a foreclosed home for $100k.

The reason why banks aren't getting rid of homes in auctions is because they don't want to totally crater the market. A city wouldn't have the same concerns.

by Upstate NY on Thu Jun 18th, 2009 at 05:07:38 PM EST
[ Parent ]
... the reason that there are returns to be had from foreclosure auctions is because of the demand versus the supply. In areas where the demand for used homes has been pushed down into the inelastic range, dumping more homes onto the market will reduce the total revenue extracted from home buyers.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Fri Jun 19th, 2009 at 01:30:51 PM EST
[ Parent ]


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