http://www.homepath.com (Fannie Mae)
http://www.hudhomestore.com (HUD)

Just to name a couple.

Incidentally, a perusal of the Fannie Mae website (http://www.homepath.com) shows LOTS of houses <$25K available in Florida. Some of them even look decent, amazingly.

At *least* the houses aren’t sitting empty, slowly decaying and creating an eyesore.

I don’t understand the latter group’s motivation for staying in business; unless those one or two houses are some high-dollar properties they’re barely earning enough to pay fees, membership dues, etc.

That $12,000 house, however, is in need of about 20-30K in repairs to make it habitable.

In a real estate market like Florida’s, which crashed MUCH harder than mine, I could see how one might be able to encounter a house requiring far less repair for $12K.

The problem that self-employed people have in obtaining credit is a perennial one.   The first step is to go to a LOCAL bank.  The second is to obtain a manually-underwritten loan.

A happy, smiling ghoul.

EDIT: I don’t have personal experience with buying foreclosures, so I edited my comment to reflect that the person I was quoting was expressing an opinion and not a fact. I have no idea how difficult or simple the process of buying a foreclosure is.

Still, more power to her.

If they are, why would anyone rent a home for $700/month when they can buy one for ~$100/month? ($12K, $0 down, 15-year term, 5% mortgage.) Surely the expense/hassle of cleaning a house would be worth the vast savings?

Given this, I suspect that the $12K purchase price is an extraordinary deal and not commonly available.

I felt a definite unease while hearing it on the radio yesterday.

I like that.  For myself, I rent in San Francisco, and the housing market here is resilient and frankly, for me, unaffordable.

But the next Big quake?  Maybe it will all come crashing down. Literally.

Also, the reason she’s sort of “meh” about all the Very Big Significance Of The Housing Crisis is not because she’s some sort of shell-shocked child of war and “this is all she’s ever known,” etc. She’s “meh” about the intricacies of the housing market because she’s fourteen years old and even truly extraordinary tweens cannot be bothered to care about that sort of thing for more than five minutes at a time. Nor should they.

Anyone who claims reselling items left behind in a house that has changed ownership is thievery does not understand that these possessions legally and morally have been abandoned.

My wife and I bought a condo about 18 months ago for my mother-in-law to live in. We paid “cash”  (pulled from existing lines of credit) of $73,000. It just appraised at $62,000.

We now want to pull some money out to pay down those other lines. Maybe $30,000.

Like many condo complexes, a good percentage of people aren’t paying their HOA fees (roughly 30%). The complex is also next to an interstate highway.

So Fannie, Freddie and FHA won’t touch it.

That is equivalent to saying “you can’t get a loan” because they make up the entire mortgage market.

This makes sense from a banker’s, “making loans on safe property” standpoint, but not from a public policy standpoint of facilitating the sale of properties to people who actually want to live in them.

Investors, of course, can get business loans to buy them then rent them out.

So why do pseudo-public corporations, nominally in the “public interest”, acting in the best interest of the bankers instead of the country? Oh, never mind.

“The place was a mess when they bought it — “like there was a riot or something,” Willow says.
They cleaned it up and rented it out to a young couple for $700 a month”

It was $12K because it was trashed and the bank that owned it probably didn’t want to spend any time fixing it up. They just wanted it gone. So the girl (and her Mom) buy it, fix it up and now have a property that can be rented out.

In Florida, where 50% of the mortgages are underwater, this kid can repeat this scenario at will.  Her mom finds a foreclosure for $12k in a ‘decent’ part of town.  Something anyone willing to look could do. 

The kid has saved up $6k and her mom throws in $6k (I heard it on the radio).  The house is in her mom’s name until the kid turns 18.  The kid has no expenses because she lives rent free at mom and dad’s (as she should at 14).  The couple that rents from her for $700 do not have to rent, they could have searched for the $12k foreclosure and bid on it.  That’d have made the bank happy.

The kid gets $700 / month, uses part to pay off her $6k debt to mom and part to pay taxes and the rest to pay maintenance or profit.  She’s no dummy and she’s not lazy.

For anyone who has missed this absolutely hilarious show, it tasks groups of people with renovating homes in Australia with the intent to flip and make a profit. Then they introduce the homes. Here, let me demonstrate -one- of them for you:

http://therenovatorstv.com.au/the-inner-city-terrace.htm

That’s right, that’s a tiny little townhouse they bought for 749,000$. Guys and gals, just look at the 33 picture portfolio of the house and prepare to laugh. It’s got an “outdoor bathroom”, and appears to be completely eaten by bugs and animals from floor to ceiling. Sure, they renovated it – but is the renovated property honestly worth more than 900,000$?!?!?!?

The rest of the homes are equally hilarious, absolutely trash buildings selling for nearly a million dollars apiece. INSANITY.

Give it a bit of time, your real estate market will come crashing down to earth.

Sigh.

 This appears to be a kid with an understanding of the basics of capitalism. What bears watching is what she DOES with that understanding.

Does she now retire from the housing market, content with her stroke of good fortune, combined with her readiness to move on an opportunity ?  Does she use that understanding to go on to making a career of real estate killings, moving inexorably in the direction of profiting off of others misfortune ? Will she be a consientous, responsible landlord ? Does she teach other prospective home buyers the dangers of blindly trusting something as volatile and as untrustworthy as the industry dedicated to unscrupulously making money off of somebody elses money, instead teaching people the fundamentals of caution, carefulness and price and institution comparisons ? Does she go out of her way to make people understand that she was lucky, and that not every one should expect that kind of luck in their own dealings ?

This whole article could just be the barest beginning of this girl’s story…