From The Wall Street Journal:
Builders rushed into this one-time agricultural crossroads during the housing boom. They put up beige stucco houses on winding streets, with names like Heavenly Place and Good Vibrations Lane. They lured young people who couldn’t afford homes in nearby Phoenix or its costly suburbs. The population soared to 37,000 last year from 1,400 a decade ago, making Maricopa one of the nation’s fastest-growing towns.
Now, it’s become a dead end for some of those people.
“We’re trapped,” says Tracy Campbell, as she watches her 2-year-old daughter romp on a playground.
In 2005, her husband, Zachary Campbell, accepted a transfer from San Diego to Phoenix to manage a recreational-vehicle store. For the first time, the Campbells figured, they could afford their own home, though that meant moving to Maricopa, about 20 miles from Mr. Campbell’s store. They scraped together a $50,000 down payment to buy a new four-bedroom home in Maricopa, for $250,000. It came with black granite countertops, cherry kitchen cabinets and a pool in back.
Today, Ms. Campbell figures, the home is worth perhaps half what they paid in 2005.
Even that might be optimistic. Along a nearby highway, young men hired by a local real estate brokerage wave red signs touting “Homes From $69.9 K.”
The Campbells planned to sell their house for a profit after a few years and move back to San Diego before their daughter starts kindergarten. Today, they couldn’t hope to sell the house for enough to pay off the mortgage. They fear the down payment they made on the house is money they won’t see again.
Some people in the neighborhood are simply walking away from their houses, leaving them for the lenders to foreclose. “We’re surrounded by empty houses on three sides,” Ms. Campbell says. But she and her husband have kept up on their payments, and want to keep their credit record clean.