STEVE INSKEEP, host:
On Fridays, we focus on your money. And today, we'll talk about people who make money when you lose. One investor's financial disaster can be another's buying opportunity, or so it would seem in Stockton, California, which is the nation's per capita foreclosure capital. Enterprising real estate agents there have launched a tour to showcase broken dreams for sale.
Rachael Myrow of member station KQED reports.
RACHAEL MYROW: Behind every foreclosure, there's a bank anxious to unload the property as soon as possible, so says Stockton real estate agent Cesar Dias. About three months ago, Dias suggested his agency wrapped too many buses with ads for RepoHomeTour.com.
Mr. CESAR DIAS (Approved Financial & Real Estate Center): Banks are going to have bank repose and we're going to provide buyers. And there's an abundance of properties so we're going to take them a busload at a time instead of the old conventional way — a client at a time.
MYROW: Or at least that was the idea. On a recent Saturday morning, the ratio of real estate agents to potential buyers ready to board the bus was running 6-to-1. But Dias' boss Greg Somerville(ph) insists that's just because the media has over-hyped the housing bust.
Mr. GREG SOMERVILLE (Approved Financial & Real Estate Center): Sensationalism is what sells copy, so we obviously have to try to compensate for it by keeping folks on track with what the reality is.
MYROW: Real estate brokers are an optimistic lot. But over 17 years, Somerville has made a tidy sum betting on Stockton. Coming from San Jose on the California coast, he saw a long time ago farmland inland would soon give way to condo developments.
Mr. JASON SOMERVILLE (Approved Financial & Real Estate Center): Okay. Everybody, we're getting ready to approach our first home here on our Repo tour today.
MYROW: Somerville's son Jason announces the first stop on this tour of Westin Ranch, a particularly hard-hit development in southwest Stockton.
Mr. SOMERVILLE: And it's a four-bedroom, three full bath, two-story home, 1,726 square feet. And it's listed at only 263,900.
MYROW: Sounds like a steal to the homeowners in San Jose or San Francisco, and there, say the Somervilles, you have Stockton's housing boom in a nutshell. Commuters and speculators from the Bay Area drove up prices here to stratospheric levels until the market fell out from under them.
Mr. SOMERVILLE: Less than six months ago, they would have had those property listed definitely in the 400 range.
Unidentified Man: 1,659.
MYROW: Jason, by the way, got his real estate license five years ago. Until recently, the only market he knew was full of irrational exuberance and risky decisions.
Mr. SOMMERVILLE: People feel like they had to get in wherever they could fit in and a lot of them pretty much had the attitude, I'm going to get this house. You know, even if it has to kill me, I'm going to get this house. And if one agent didn't help them, another one would. And that was the kind of their mentality, you know.
MYROW: Economists say regions like inland California are taking the brunt of the housing bust because those areas are where homebuilders have been busiest in recent years. Now that the market is sour, they suddenly have to unload a lot of new product and that depresses prices across the board. But that may prove a boom to local families who couldn't afford to buy when prices were sky-high.
(Soundbite of vehicle starting up)
MYROW: Rafael Espino(ph), a welder from northeast Stockton is scouting on behalf of relatives.
Mr. RAFAEL ESPINO (Welder): (Spanish spoken).
MYROW: Espino says he loves the tour. He's getting a broad view of what's available in neighborhoods all over town. The agents running Repo Home Tour say after years of fantasy real estate, Stockton simply come back to Earth - sober words in a town born during California's gold rush.
For NPR News, I'm Rachael Myrow in Stockton.
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