Tuesday, March 25, 2008

This Is Our World

I wonder what the advertising would look like for this tour. How do you make a tour of repossessed homes at rip-off prices seem like something to be proud of doing?

On the rational side, I applaud this realtor for getting out there and doing something new. The current U.S. economy has not been much kinder to Realtors than to those who are losing their houses. On the emotional side, it seems pretty depressing.


From the New York Times, March 16th:

A Tour for the Times, Seeking Deals Among the Repossessed

TRAVERSE CITY, Mich. — Most of the houses on the real estate tour in and around this quaint resort town on Lake Michigan were in fairly good condition, empty and scrubbed clean of the sort of things that might bring to mind the previous owners.



Sherry White, a real estate agent, said that with so many repossessed houses in her listings, it was efficient to rent a bus and show them as a group.

The two-bedroom on Pine Grove Avenue was a charming cottage, maybe a starter house for a young couple, but who knew? The ranch on Sugar Bush Road was pristine down to its finished basement, which might have been an office, or a home gym.

There was no telling, but lots of quiet guessing by the 15 people who paid $5 each to board a packed minibus for three hours last weekend with a real estate agent. Every house had its back story, and none of them were going to be particularly pleasant.

This was not a parade of show homes, but rather the Repo Buyers Bus Tour, one in a series of such marketing excursions popping up across the country. Every house on the tour had one thing in common: foreclosure.

The agent, Sherry White, cheerful with a binder of the listings in hand, dwelled on the potential for rebirth in the homes — not the “carcass feeding,” as one competitor characterized the appeal of the expedition. Ms. White’s tone was matter-of-fact. Banks owned the properties, she emphasized as the bus took off, “so you’re not kicking anyone out of their home.”

People on the tour also had one thing in common: they were looking for deals among the repossessed. Still, not everyone was entirely comfortable with the cold mission of cashing-in on their neighbors’ misery (and it was cold because the electricity had been turned off in most of the homes and the heat was at a minimum).

“This feels like walking in a graveyard,” said George Foster, a local newspaper publisher looking for investment property. “I felt uncomfortable even coming on this tour for that reason. There’s a lot of pain in these houses and how they became available.”

Ms. White said she had so many repossessed properties in her listings that it was just efficient to rent a bus and show them as a group. She thought up a theme: “Getting the grass green again.” The homes ranged in price from the $70,000s to the $300,000s, and most appeared to be primary residences, not second homes.

Though she had not written up any offers from the tour, she said she was encouraged by the level of interest.

“It’s sink or swim in this area,” Ms. White said of the troubled real estate market. “I decided to build a ship.”

One participant, Sandy Piotrowski, said the tour was about being pragmatic. “It’s pretty sad that there are so many houses on the market, but it’s also a good thing to move these homes,” Ms. Piotrowski said.

In Michigan, the unemployment rate has been higher than the national average since September 2000. With job loss has come home loss, only compounded by crisis in the subprime mortgage market. Census officials estimate that Michigan lost 30,500 people in the year starting July 2006, one of only two states (along with Rhode Island) to lose population in that time.

Nevada, California and Florida lead the nation in foreclosure rates. Michigan ranks sixth, with one foreclosure for every 409 households and for its 10,957 filings in February (up 17.84 percent from February 2007), according to RealtyTrac Inc., which manages a nationwide database of real estate information.

An older couple on the tour here were hoping to find a deal on a retirement house. A young couple were looking for their first home. Others were looking just to be looking, and the chatter was about work and family and the weather.

But every once in a while, emotions buried just beneath the surface cracked through.

That was the case with the house on Greenbrier Lane. While most of the houses were silent about their pasts, this one seemed to scream its history.

In the foyer, a trampled-over card read “Happy 1st Birthday!” and the walls still showed a child’s scrawls in blue crayon. Hair pins and SweeTarts were on the floor in a bedroom. The kitchen was filthy, the bathroom unbearable, the garage door broken off.

The home, a 30-year-old, 1,400-square-foot bilevel, was listed at $100,000, about $35,000 less than its asking price in the spring of 2006. This was its second repossession (from different owners) in two years. Some wondered if it had been trashed deliberately.

As he walked through shaking his head, Richard Deskovitz, a retired teacher, asked, “Can you imagine the rage in someone’s mind when they lose their home?” He took a moment to think about it.

Others took shots at dark humor. “Those are the colors you paint the walls when you think the bank’s taking over,” one person said. There were giggles about the bright yellows and greens.

But others seemed moved by whatever lingered in the cold, dark air. Back on the warm bus, Patty Fitzgerald, an attendee who was looking for a retirement home, said of the house on Greenbrier Lane: “I don’t like to see that. I couldn’t live in that house. It’s not like somebody died there, but somebody’s heart died there.”

This was the second Repo Tour for Ms. Fitzgerald and her husband, Steve, a retired stockbroker. “You know when you see the kids’ things, the little swing sets in the backyard, remnants of a few broken toys on the carpeting, somebody’s family took a dive,” Ms. Fitzgerald said. “Somebody had a real hard time. That’s not a fun thing.”

The Fitzgeralds were hoping to see a house whose insides did not display lingering signs of pain.

But even from the outside, Joe Steffes, the tour bus driver, has a hard time looking. He grew up in this area, has lived here for decades. He knows people on these streets.

“Just tough times,” Mr. Steffes said, sitting in the idling bus outside one house. “I try not to think about it.”

Then it was off to the next address.

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