Baltimore Feeling The Pain Of The Housing Slump

The housing bubble was powering a revival in Baltimore, says the NYT, but the recent turmoil in the credit markets and a spike in foreclosures may have cut the party short.

In the spring quarter, 25 percent of the foreclosures were in the city itself. The numbers are up even in Belair Edison, a stable working-class neighborhood of neat, two-story row houses adjacent to a picturesque wooded public park.

The homes are occupied mostly by teachers, police officers, firefighters, shop owners, university workers and similarly employed wage earners. Some had originally taken on standard fixed-rate mortgages and then, to save money or take out equity, had gotten into trouble by refinancing at variable rates, according to Mark Sissman, president of Healthy Neighborhoods, a nonprofit organization that helps homeowners.

“They were offered loans that in some cases did not require them to escrow for taxes and insurance, and they took them,” Mr. Sissman said, “and then they wake up with a six-month tax bill and if they can no longer refinance, they are in trouble.”

Several nonprofit groups have stepped up assistance to families in trouble, helping them renegotiate loans or, if necessary, sell their homes so they will not be left empty, starting the deterioration that can turn a neighborhood into a slum.

For Baltimore, Housing Slump Slows a Revival
(Photo:Dennis Drenner for The New York Times)