Foreclosures decline, while foreclosure businesses thrive
Foreclosure activity dropped by more than a third this past year, according to the group RealtyTrac. But despite the national slowdown, regional companies that take care of foreclosed homes are still thriving. Their job is to keep empty houses clean and safe from the forces that depress local property values: squatters, thieves and decay. Dawn Hammontree probably never expected to see their work firsthand.
The first part of Dawn Hammontree’s story is familiar in Michigan. Her unemployment ran out in December.
“Got the foreclosure notice in March. Which is very scary,” she said.
Hammontree used to work for a property-tax firm that did business with the Big Three automakers. They took a hit. She was laid off. She says that for the next three years, she sent out 60 resumes a week. She was desperate to keep a roof over her son’s head.
By January, Dawn Hammontree couldn't pay her mortgage. She got the foreclosure notice in March. Photo by Kate Davidson
“I felt like I was being sucked into a black hole,” she said. “I had trouble sleeping. Wasn’t eating well. Just a general feeling of despair and despondency.”
Then, just three days before her time was up, Dawn Hammontree’s bank agreed to a trial mortgage modification. She’d finally found a job. And the one place she could get in…well…
“The job that saved my house from foreclosure is working for a company that maintains and preserves foreclosed homes,” she said. “It’s been three months that I’ve been there and I have not gotten over the irony of this. I chuckle whenever I think about it. We’re not short of work.”
Foreclosure rates may be generally falling, but you wouldn’t know it in the trenches.
Brandon Johnson runs a property preservation company called GTJ Consulting. We’re walking through a single family home in Roseville, Mich. Yesterday was the eviction.
Today is the “trash out.” Johnson’s crew removes debris so the bank can eventually resell the house. Garbage bags fill up with the remnants of family life. A volleyball net. A rubber spatula. Children’s drawings. A little yellow book called Toilet Training in Less Than a Day.
Brandon Johnson made a business out of maintaining foreclosed properties. Photo by Kate Davidson
Though their overall foreclosure rates fell, Michigan, Ohio and Illinois were among the ten states with the most foreclosure actions last month, according to RealtyTrac. The firm includes everything from default notices to bank repossessions in its count. In Illinois, that final stage of foreclosure — bank repossession — actually increased 20 percent from June.
Johnson says it’s been bad enough in Michigan that he sometimes sees houses two or three times.
“The same home,” he said. “We’ve come in; we’ve cleaned it out; we’ve cleaned it up; we’ve maintained it. It’s sold. And then 24 months later, we’re right back to the same house again. It’s mind boggling. It really is.”
When Johnson started the company ten years ago, it was just him and his dad. Now they have two offices, 120 full-time employees and a network of contractors who change locks, mow lawns and winterize pipes, among other things. A few years ago, the Johnsons started a foundation to give away items left behind in foreclosed homes.
GTJ isn’t the only expanding business in the field. In December, the group Safeguard Properties was recognized as the fastest-growing company in Northeast Ohio with net sales of more than 100 million dollars. They’re up to 900 employees. The company’s founder says business is still increasing.
Back in Eastpointe, Mich., Dawn Hammontree sits in the kitchen that’s still hers for now. She’s profoundly grateful. But she says there’s no guarantee it won’t all fall apart again tomorrow.
“I’ve got this great job,” she said. “I love the job. I love the people I work with. And I know, now, there’s no such thing as security.”
This story is informed by the Public Insight Network.