Parade of unsold homes

Overbuilt market creating modern ghost towns

Excerpts:

Scott MacDonald, a 40-year-old lawyer, and his family were among the first buyers of new homes in Kirkway Estates, a residential community in the Detroit suburbs. The MacDonalds paid more than $500,000 in 2006 for a home that would be ready in July 2007. The Colonial-style brick home had four bedrooms, three-and-a-half bathrooms, and designer touches and offered everything they expected in a town known for great public schools and homes fit for Ford execs.

Everything, that is, except neighbors.

When the MacDonalds arrived, there were fewer than 15 homes in Kirkway Estates, where 179 were planned. Their home was the only one built thus far on a cul-de-sac with six lots. They expected more houses to appear soon after they purchased, but instead Kirkway’s builders ran into financing trouble and work on the community’s remaining lots halted, leaving the MacDonalds and their handful of neighbors in limbo.
...
Economists have said that for the housing market to correct itself, inventory levels and sales prices will need to decline during 2009 — which may mean half-built communities don’t get completed and remaining homes are sold at a discount. Tim Newport, U.S. Economist for Global Insights, said in a July 31 housing market report that although the number of newly built single-family homes continues to drop, the market still has an oversupply of about 100,000 homes, based on June’s inventory of 426,000.

Comment: I think that Albertville MN is like this too!