Nevada posted the highest foreclosure rate in the U.S. for the 55th straight month, with one foreclosure per 115 housing units in July alone (you might recall that they’re late on their credit cards too). California (home to 7 of top 10 metro areas) claimed second place, while Arizona fell to third. Vermont (“the responsible state”) boasted the lowest rate, with only one foreclosure per 28,568 housing units.
In all, lenders repossessed almost 68,000 homes in July, down 34% from a peak of 102,000 in September 2010. Some of those foreclosed homes end up on reality TV – even Vanilla Ice can “Ice Your House.” But lenders still own a backlog of 817,500 repossessed houses, and almost a third of those belong to Uncle Sam.
Figuring out what to do with 248,000 homes is no easy feat, so that’s where we the taxpayers come in. In August, the Federal Housing Finance Agency, along with the Department of the Treasury and Department of Housing and Urban Development, asked if we had any suggestions. Mark Wiseman, former director of Cleveland’s foreclosure-prevention program said that, “It’s almost like having the captain of the Titanic go on the public address system and say, ‘Does anybody have an idea?’ …It’s not a confidence builder.”
The government is looking for ways to shrink its stockpile while reducing loan losses, stabilizing home values, addressing maintenance and repair requirements, and improving the supply of rental housing. Perhaps we could reduce the unemployment rate by flipping a few fixer-uppers? Or “micro” is hot. Think microfinance… or “microprisons”. In one fell swoop, we’d give these houses a purpose and also reduce prison overcrowding. Or maybe it’s time for a Home Away “hostel” takeover?