NYTimes on Foreclosures in Cleveland

Check out the slideshow from the article:

"SHAKER HEIGHTS, Ohio — In a sign of the spreading economic fallout of mortgage foreclosures, several suburbs of Cleveland, one of the nation’s hardest-hit cities, are spending millions of dollars to maintain vacant houses as they try to contain blight and real-estate panic.

"In suburbs like this one, officials are installing alarms, fixing broken windows and mowing lawns at the vacant houses in hopes of preventing a snowball effect, in which surrounding property values suffer and worried neighbors move away. The officials are also working with financially troubled homeowners to renegotiate debts or, when eviction is unavoidable, to find apartments."

Notice how someone felt they had to spraypaint "NO COPPER - PVC" on the plywood covering the window in the first picture.

This is why loss severities will be so bad.

What will banks' REO be worth when the "owners" take out the copper plumbing, appliances, and maybe the windows on the way out?

Or when the bank finds that the McMansion's "owners," who purchased with zero-down, "gutted interiors and used every inch to grow pot, knocking down some walls and cutting holes in others to run water lines and ducts. They installed irrigation systems with timing devices and brought in water tanks, pumps, generators and power packs. They built scaffolding to raise plants 2 feet off the floor." (USA Today)

How much are houses 2 hours from LA worth if gas prices increase and credit tightens, even if the houses are intact?