A report released early this week spells out the wider impact of foreclosures. Researchers at the Center for Responsible Lending (CRL) note that almost $2 trillion in property value has or will be lost by residents. It doesn’t even include equity losses due to foreclosures, which have been estimated at $7 trillion.
Foreclosures have brought down property values across the country. Your home has been affected even if there are no foreclosures in your neighborhood (which would be pretty rare, I think). That value reduction means that while you’re paying lower property taxes, your municipality and school system is getting less money, too. If there are many foreclosures in a given area, there can also be blight and crime issues that come into play.
We all know intuitively that foreclosed homes are not a good thing for neighborhoods. Unfortunately, there are still a lot of them sitting out there, many that haven’t even been listed.
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