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Format Dynamics- :: C1eanPrint :: http://www.startribune.com/business/115807964.htm1 Page 2 of 3 <br />~~. <br />_ ~_ <br />P~~int ~do~+r <br />~ s ~7iobi'~~ Er~~~n~,er Iv <br />4 "ip~.'.'_[;'irtrila.nr cprn <br />~~r~T~~~ <br />neighborhoods that had seemed. on the <br />upswing prior to the housing crisis but are <br />now giving back some of the gains. <br />Though there are certain neighborhoods in <br />the Twin Cities that have been. particularly <br />hard-hit, Cramer said that this is an issue <br />that has implications for the health. of the <br />entire state. Aside from causing a drag on <br />home values, foreclosures cause declines in <br />property tax revenue, they cause trouble for <br />schools and. they make it difficult for families <br />to function in a healthy way. <br />"Our region is really one economy, and the <br />weakest areas diminish the strongest and <br />impact the overall. quality of life here," he <br />said. <br />In the metro area, foreclosures increased 9 <br />percent from 2009 to 2010; in greater <br />Minnesota there was a 16 percent increase. <br />The highest foreclosures rates, were in so- <br />cal.led "collar" communities surrounding the <br />metro area. During the building boom, "drive- <br />until-you-qualify" home buyers traded a long <br />commute for the opportunity to own a home. <br />Many of those buyers were first-timers who <br />were already living on tight budgets and <br />couldn't keep up after losing a job. They <br />often put little money down, giving them no <br />equity, as home prices sunk. <br />The worst was Sherburne County, where the <br />foreclosure rate is almost 3 percent. <br />Many foreclosures during the first couple of <br />years of the crisis -- there were more than. <br />26,000 in 2008 -- were the result of <br />mortgage and other kinds of fraud. That's <br />not necessarily the case anymore. Experts <br />widely agree that the latest wave of <br />foreclosures is being driven by <br />unemployment and underemployment, <br />meaning workers have had their hours cut <br />and they can't find other work to make up <br />for the lost income. <br />"Until we see protracted periods of job <br />creation, we will see elevated numbers of <br />foreclosures," said Ed Nelson, spokesman for <br />the Home Ownership Center. <br />In outstate Minnesota, the problem is <br />particularly acute in smaller communities <br />that don't have diverse economies that are <br />able to rebound after a business closes. <br />Crystal. Pastien lives in one of those places: <br />Eden Valley, a town of about 800 people <br />that's northwest of St. Cloud with only a few <br />businesses, including one that relies on temp <br />workers when there's business to support it. <br />Advertisement <br />"'~ ~ ~ <br />Mn <br />r• <br />f~~~'~ ~~ <br />~~Y ~~~~i ~~~~~ <br />~n ~rtdq • (E~tC~s'tt <br />~N--;<t, f ^':,' ,. '~.~+~'5xa red: s zr~ a~ s ia.+rta-~.,:- r~'~~~t~G1C~h~.~o <br />http://www.startribune.com/templates/fdcp? 1297694056731 <br />2/14/2011 <br />