Speculators are buying these foreclosures at 60-65% of their worth if updated and rehabbed. They pump in 10-20% in new floors, paint, frilly trim, windows, kitchen, etc, then put them on the market at top dollar and make 20-30% profit on the sale.
The realtors, lenders, attorney’s are all still making money and the rehabbed homes are killing appreciation and demand of the surrounding homes that are in average condition and not updated to the hilt.
BTW, my co-worker just got in the mail yesterday an unsolicited package from Countrywide Mortgage' stating he could borrow over '$130K in equity in his home and no credit checks on the "Fast Track Approval" and they could have the money in his hands in 2 weeks.
Now, didn't Countrywide just go bellyup and is in the process of being bought out by BOA??
Tell me there ain't a Ponzi still working on this stuff.