Home -> Law Blog Directory -> Bailout Blogs -> Calculated Risk

Bailout

: Calculated Risk

More on Demolished Houses in Victorville

By Anonymous

Last week a number of blogs posted a video from VisionVictory of new homes being demolished in Victorville, CA.

Here is the story from Peter Hong in the LA Times: Housing crunch becomes literal in Victorville

The Victorville demolition is one of the most dramatic ends to a bad bet made during the housing boom, but abandoned developments have become an all-too-common sight in California. Nearly 250 residential developments totaling 9,389 homes have been halted across the state, according to one research firm.

The developer of the Victorville project had hoped to sell the houses for more than $300,000 as they were being built last year, Forrester said. But reality quickly diverged from that vision. ...

Officials of Guaranty Bank of Austin, Texas, which took over the development last year, were unavailable for comment. But Victorville city spokeswoman Yvonne Hester said the bank decided not to throw good money after bad.

"It just didn't pencil out for them," she said. "They'd have to spend a lot of money to turn around and sell the houses. They just made a financial decision to just demolish them."

And from the WSJ: No Sale: Bank Wrecks New Houses

A video of a backhoe knocking down homes in Victorville, Calif., was posted on YouTube by the founder of a Web site called Vision Victory.

A Texas bank is about done demolishing 16 new and partially built houses acquired in Southern California through foreclosure, figuring it was better to knock them down than to try selling them in the depressed housing market.

Guaranty Bank of Austin is wrecking the structures to provide a "safe environment" for neighbors of the abandoned housing tract in Victorville, a high-desert city about 85 miles northeast of Los Angeles, a bank spokesman said.

And more video at MarketWatch.

Full post as published by Calculated Risk on May 05, 2009 (boomark / email).