Stockton, the Icon of the Housing Boom Years, is now the Second Most Miserable City of America

The Central Valley was once renowned as the bread basket of the country with its fertile soil. Today it is the infamous centre of the foreclosure crisis. Ordinary people have seen their homes and dreams, their savings and hopes swallowed up by foreclosures. They are left with only the nightmare of debts running into billions.

Janine Wells is one of the unfortunate victims. Her house in Stockton, a farming town, has been taken over by the bank and being sold for half the amount she bought it for in 2005. She bemoaned, "It turns your life upside down, it affects everything you do and everything you believe in." When they bought the house both Janine and her husband Rick were employed, the parents of a new born child and were feeling on top of the world. Sitting in her living room encircled by packed boxes ready to leave within two days her laughter sounded bitter. She said, "We took out loans to buy cars and go on vacations. The day we bought the house, we took out a loan on it because our realtor said it was already worth $50,000 more than we paid for it. Now we learnt the hard way, what goes up must come down."

The capital of California, Sacramento has not been spared – it is reeling with foreclosures and holds a top rank among the hot foreclosure spots in the country. 6.6% of all residential houses in Modesto were in foreclosure last January. These are being sold off at half price by the banks. A string of foreclosures are waiting in the pipeline. As per early March figures about 20% of all the mortgage loans on residential units in the city were lagging behind by more than 90 days.

In Stockton 6% of the residential houses are in the foreclosure zone and 18% of the homeowners are lagging behind and thus threatened by foreclosure. As per the findings of Central Valley Business Times, out of ten homes in the town, eight are underwater – the value of the property being less than the value of the unit. This has resulted in many borrowers to walk away from the loan. In the list compiled by Forbes of the America’s Most Miserable Cities, Stockton was placed second after Cleveland. Stockton had been an icon of the housing boom. Cleveland has been in trouble for a long time in the rust belt.