Housing Bust Merciless to Merced
"[H]ardly anyone in Merced [California] planned very far ahead.
Not the city, which enthusiastically approved the creation of dozens of new neighborhoods without pausing to wonder if it could absorb the growth.
Certainly not the developers. They built 4,397 new homes in those neighborhoods, some costing half a million dollars, without asking who in a city of only 80,000 could afford to buy them all.
...At Gardenstone, part of the Bellevue Ranch development, the doors of the sales office are covered with plywood, as if a big storm were coming. A few blocks away is Riverstone, probably the bleakest Merced subdivision. A dozen houses were started here and then the construction workers went away. The wooden frames have been bleaching in the sun and sand for more than a year.
As Merced goes, so might go much of the nation. With as many as 2.5 million homes in the United States entering foreclosure this year and, at best, sales of only five million existing houses, the foreclosure price is becoming the rule in many areas."