California Realtors Hard Hit By Foreclosures

August 15th, 2008

The California realtors are one of the worst hit by foreclosures. The value of houses has fallen by 43% in Victorville. Previously the city had rebounded back from similar slumps. But will it this time?

Jackie Harvey is one of the many realtors twiddling her toes waiting for customers. Till 4 pm nobody had knocked on the doors of her office in Arbor Lane. It had been the same yesterday. On her shop shelves was a Spanish style house. There are quite a few others as she waits for footfalls. The foreclosure crisis has hit her in a bad way. “We’re starving,” she moans struggling with an unemployment compensation.

Victorville and other exurbs like it is the core of the foreclosure crisis in America. Only a year ago it was ranked the second fastest growing city after New Orleans with a surge of 9.5% from July 2006 to 2007. Recently foreclosures have doubled with the price of new houses going down by a whopping 43%.

The exurbs were fast growing new areas on the fringes of the jumbo cities. For these it will be no easy task to get back on the rails as easily as the other traditional suburban and urban centres. The latter have experience about downturns. This makes many who are optimistic that Victorville will pull through. Hans Johnson of Public Policy Institute of California comments, “Places like Victorville that are on the edge of growth have seen boom and busts before.” It will recover he adds.

Victorville was a vacation spot in the desert in the 1920’s. The clean desert air attracted Hollywood residents. It was a natural halting place for those driving through California. Here there was an air force and a flight training school that brought jobs and people. When the base was vacated the city fell into bad days. About 10,000 jobs vanished. These were troubled times and the local economy began to totter. Not to take things lying down the city fathers turned to developing the air base anew. It soon created new jobs and gave the push.

This time too the city might surface from the foreclosure crisis. There are indications that the number of house owned by the banks is decreasing. In Southern California about 41% of the houses that went up for sale in July were repossessed by the banks. It indicates that buyers are snapping up bank discount deals.