Communities suffer as foreclosure rate rises

John W. Schoen Senior producer • Profile • E-mail

As mortgage defaults and foreclosures continue to rise, the impact is spreading well beyond those who are losing their homes.

In communities across the country, msnbc.com readers report that local governments are coping with shrinking tax rolls, lenders are saddled with more foreclosed homes than they can sell and empty homes in many neighborhoods are being vandalized.

Like everything associated with the nation's housing crisis, the fallout from foreclosures is very local, a fact confirmed by hundreds of e-mails from readers in msnbc.com's Gut Check America. Some regions appear to have escaped relatively unscathed. But in hard-hit states like California, Arizona and Florida, readers report that some neighborhoods are becoming virtual ghost towns.

In Indian Harbour Beach, Fla., “lots of homes have been abandoned by their owners, and many people are going into bankruptcy,” wrote a reader named Robert. “Whole condo projects sit half-finished and rotting in the Florida sun. On some streets almost half the homes are empty. Many people have lost 40-50 percent of the value of their homes. “

Others report a different kind of isolation; many of those losing their home to foreclosure are reluctant to confide in family or friends until the process is complete. Some neighbors are unsure how to respond.

“My community is an upscale middle-class community; I am going through foreclosure right now,” wrote a woman from Pennsylvania. “The neighborhood is very quiet, waiting for the next fall to happen. People do not even talk to each other. They wave but hardly say a word.”

In South Lyon, Mich., life is getting lonelier as more houses are abandoned in Jose's neighborhood.

“I live next door to empty houses instead of neighbors and friends,” he wrote. “It is an overwhelming feeling of dread. You wonder if your family is next."

In hard-hit neighborhoods, the glut of foreclosed homes has not only sent prices crumbling — the houses themselves are also falling down, according to a number of readers from around the country.

“Our neighborhood is going down the tubes because the properties are going unsold for so long that they're falling into disrepair,” wrote Leslie from Albuquerque, N.M. “It's a mess.”

In Memphis, Tenn., Angela reported that her neighborhood was dotted with “growing weedy yards, windows with papers taped to them and broken. There are about five or six such homes in my post-World War II subdivision. And these are NOT expensive homes!”

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“My neighborhood is filled with renters who could care less about the parks or the appearance of the homes,” wrote Joe Brogdon, of Queen Creek, Ariz. “There is a smaller home near mine that has no windows and it is barricaded with plywood to prevent any more vandalism to the house. Many of the lawns are not being taken care of, which does not help the situation for resale or pride of ownership.”

Some houses have been damaged by angry, frustrated homeowners who lose their homes to foreclosure, according to Mark in Stockton, Calif., where the foreclosure rate is among the highest in the country.

“This city has so many foreclosed homes that are trashed there is an ad on local TV offering up to $1,000 to people not to trash their home before they are kicked out of it,” he wrote. “The problem here is grave.”

In other cases, abandoned homes are more than an eyesore. Readers in some hard-hit areas report a rise in vandalism, squatting and other crime.

“Vandals have been hitting the empty homes that have been affected by foreclosure in my area,” wrote Gloria of Los Angeles. “With summer around the corner and kids out of school, I just worry about fires starting or other serious problems happening.”

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