In 2005, America had a shortage of homes. Today, its banks are using bulldozers to get rid of the oversupply.
Bloomberg reports that the Bank of America has a glut of foreclosed homes that it can not sell. In June 1,679,125 were in some stage of foreclosure. Flooding the market with the surplus homes further depresses the market and scares of buyers who are waiting on the sidelines for the bottom of the market.
The banks are now donating homes and contributing funds to their demolition through the federal Neighborhood Stabilization Program, with the lender paying as much as $7,500 to have the homes demolished. Homes earmarked for demolition are believed to be in varying states of disrepair and with such a glut of properties on the market, there is no prospect of anyone buying them.
» BofA Donates Then Demolishes Houses to Cut Glut – Yahoo Finance, 27th July 2011.