Open Forum (5/6-)

Posted by Dave Fratello on Tuesday, May 5th, 2009 at 9:34pm.

Maybe it sounded a little bit silly last Summer.

A commentary in the Wall Street Journal suggested that we could make headway against the mortgage mess by "buying unsalvageable houses and demolishing them." (See MBC's "What to Do with All the Unneeded Houses?")

Pimco's Bill Gross was quoted saying that, "in an ideal world," the federal government would "buy one million new/unoccupied homes, blow them up, and then start all over again."

Demolishing perfectly good new homes? Silly.

But it was real this week, as a Texas bank holding title to a failed development of new homes in Victorville rolled out a wrecking crew to flatten several completed and partly completed homes.

No, it's not the government doing it, but private capital. If it costs more to finish the homes (~$1m) than to destroy them (~$100k), and you can't make money selling them, you destroy them.

Click here for the video via KTLA or here for the LA Times story.


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