http://www.time.com/time/magazine/article/0,9171,1736710,00.html
The black bus rivals a greyhound in size but has an interior like a limo–and it gets a few curious looks as we wander into the dense neighborhoods of Elk Grove, Calif., a quiet suburb 15 minutes south of Sacramento. Five of us–a mortgage counselor, three investors and I–are looking at 10 recently foreclosed homes dubbed “excellent deals” by the O’Brien Co., the agency that set up the trip.
These “magical misery tours” are real estate agents’ attempts to move their ever increasing inventory fast, as the mortgage crisis forces more and more homeowners into foreclosure. The idea originated in nearby Stockton last year and has migrated to other cities in California, Michigan, Florida and Massachusetts. Elk Grove alone has about 2,120 bank-owned houses for sale and 1,280 in pre-foreclosure, according to RealtyTrac, a real-estate-data website. The places we see vary from spotless to foul-smelling. One house, which appears to have been vacated in a hurry, has enormous stuffed animals on the windowsills and children’s artwork still pasted on a wall. This three-bedroom, two-bath home is going for $210,000–about half the $400,000 it sold for in June 2005.
Like many communities across the U.S. that boomed during the housing bubble, Elk Grove is feeling the pain of the housing burst. For the most part, the trauma of eviction is hidden–the suburb has the occasional overgrown yard, although not as many as I’d expected, and FOR SALE signs dot the streets. But a funny thing happened on the way to Elk Grove’s demise: it has started to come back. Over the past six months, investors and first-time home buyers have moved in, snapping up homes now priced at less than $250,000. Residents are working to make sure the neighborhoods they traded up to remain desirable, getting together to mow lawns of bank-owned homes, partner with the police and draft ordinances to hold landlords accountable for disheveled properties. “We’ve just changed our mind-set,” says resident Phillip Stark. “It’s no longer what can the city do for me, but what can I do for the city.”