With home foreclosures on the rise, one man is making the best out of a bad situation.
Cesar Dias, who has been in real estate 18 years, is making sure that the foreclosed houses in his hometown of Stockton, Calif. are getting sold, in a quite unusual way.
Dias leads the weekly "Repo Home Tour," where he fills two large, brightly colored buses with prospective buyers looking for houses with big price reductions. There is almost an art to the way he makes the home-buying experience fun.
He tempts prospective homebuyers with sweets and good cheer as if the whole thing's a party, then loads the whole crowd onto a couple of buses as if they're all going on break.
But if you ask Cesar Dias why he conjured up Repo HomeTours three months ago he'll tell you it's not about money, or profits, or exploiting the misfortune of others, but about saving neighborhoods in Stockton.
Many of the foreclosed properties are in still thriving communities, where the homes are dressed up for Christmas, and where the ice cream truck still rolls through, but where the occasional homeowner got in too deep and lost it all. Dias believes he is providing a necessary service.
"We have an abundance of properties," said Dias. "And banks have to sell, and we have to provide buyers."
With this simple logic, Dias believes he is saving homes. And many of the homes in Stockton need all the saving they can get. This was a town that was born in the California Gold Rush, and over time has experienced the all too typical real estate boom -to-bust.
There was a housing construction boom partly fed by people who could not afford the expensive houses in San Francisco, 60 miles away. As more and more homes were being built, prices went down and homebuyers were finding homes they could afford, or so they thought.
Many homebuyers simply bought to turn a profit; heedless to the bust that would inevitably come as homeowners could no longer afford their mortgage payments.
According to RealtyTrac, a group that monitors real estate, Stockton had the highest rate of foreclosures of any metropolitan area in the nation between last July and September.
If there is good news for anyone in that statistic, it would be for people like Elissa and Jon Hernandez, who were on Dias's tour this week. The Hernandez's have been renting for years but believe they can finally afford to own a home, thanks to the decreased prices of the foreclosed homes in Stockton.
In fact, one of the houses displayed on the tour was a two-story, 2,600-square-foot house that was purchased for $504,000, but now the bank that owns it is only asking $285,000. Hearing about these price drops is part of the thrill of the tour. Participants have a sense that they might just get lucky and have a home drop right into their laps.
It happened for Daniel and Debbi Noel. They had been living in a one-bedroom rental with air mattresses in the living room since their boys were little kids. Now all four were on the tour, just to celebrate how great shopping foreclosures can be.
It was made even better because Dias threw them a party for their first day in their new house, the first that couple has ever owned. The Noels were thrilled to get the house—apparently a lot of people were looking to buy it.
"We settled on the home for $185,000. It was on the market for $179,000," said Daniel Noel.