Quote:
Originally Posted by LOCOChief
QUOTE=Saul Good;7803105]I don't think it would lower property values. The damage has already been done. This is just acknowledging it. A vacant house that falls into disrepair and eventually sells for squat is going to lower property values more than auctioning a house before it falls into disrepair.
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I think that you are right in that before the collateral becomes more dilapidated get rid of it.
But who should absorb the deficiencies? In the end it can only be the tax payer.[/QUOTE]
IMO, this wouldn't cause deficiencies. They already exist. This would simply be recognizing what has already become a reality. These houses are worth what they are worth. With every day they sit unoccupied, that value decreases. Sitting on them isn't really in anyone's best interests. Maybe this would encourage lenders to be more willing to restructure loans before they foreclose.
There are basically 2 premises from which I am starting:
1. The housing market can not recover until prices reach equilibrium.
2. Empty houses are bad for everyone (except criminals).