Housing News: U.S. Home Prices Double Dip & L.A. Sues Deutsche Bank over Evictions
Posted on May 5th, 2011
Fears of a housing double dip were realized on Thursday with news that the U.S. had officially seen home prices drop below the lowest point of the recession. And in related news, the city of Los Angeles is suing Deutsche Bank for its illegal foreclosure activities, including the improper maintenance of its properties.
U.S. Suffers Official Housing Double Dip
A new report from Clear Capital has confirmed fears of a housing double dip. According to the report, home prices are now lower than they were in March 2009, which was previously the low point in the midst of the recession and after the housing market crash.
While most hoped that the industry was not headed south after what seemed to be a recovery with the success of the First Time Homebuyer Tax Credit, homebuyers’ inability (or lack of desire) to buy homes due to a shaky economy, along with the foreclosure crisis, left the housing market in an irreparable state.
According to the report, the sale of bank-owned properties (thanks to foreclosures and short sales) hit 34.5 percent of the market. The rush of empty homes into the market contributed to a national price drop of 11.5 percent in the past nine months, causing prices to double dip.
L.A. Sues Deutsche Bank over Foreclosures
In Los Angeles, one bank is in trouble over its unsatisfactory foreclosure activities. Recent reports show that the city of Los Angeles is suing Deutsche Bank AG for illegally evicting low-income tenants then failing to properly maintain the properties once empty.
Los Angeles City Attorney Carmen Trutanich says the bank has become “one of the major slumlords in the city” after buying more than 2,200 properties through foreclosure then letting the vacant buildings fall into disrepair. She says the bank also unlawfully evicted its tenants in order to sell buildings, not unlike other banks that have contributed to the foreclosure crisis and housing double dip.
California’s lawsuit filing comes only one day after the U.S. Justice Department sued the bank for more than $1 billion, claiming that it lied while arranging federal insurance on faulty mortgages. In the L.A. suit, Trutanich seeks a court order for the bank to clean up its city properties and pay restitution.
Trutanich said in a statement that the bank could ultimately be liable for “hundreds of millions of dollars.”
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Tags: Dip, Double Dip, Home Prices
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