There goes the neighbourhood: mortgage crisis sees suburbs slump

As the banks foreclose on loans across the US, worried householders watch their tree-lined streets change

Susan McDonald doesn’t look like an activist. She drives a nice car, wears smart clothes and appears to be the embodiment of the neighbourhood personal banker she is during office hours. But after work McDonald has another life. It is then that the mother of three turns into a neighbourhood organiser, determined to mobilise her community to battle for a way of life that many believe is in peril.

McDonald is a self-confessed suburbanite and president of the Franklin Reserve Neighbourhood Association, a new development in the city of Elk Grove, 15 miles south of the California capital, Sacramento. Franklin Reserve, a collection of imposing houses stationed on anonymous cul-de-sacs bearing improbable names – Snow Leopard Circle, Fox Trotter Way – is at the heart of what some see as a struggle for the soul of suburbia.


The full onset of the mortgage foreclosure crisis, coupled with demographic changes, rising fuel prices and a host of other factors means that the suburbs could be on the way out. One analyst has postulated a future in which the suburbs, which once promised so much domestic happiness, are transformed into the new slums, with rampant crime fuelled by poverty and decay. The term “slumburbia” was not far behind.

Franklin Reserve, a walled but not gated community of 15,000 people, appears to be a prosperous development. But there are signs that all is not well. Some front lawns are unkempt, and for sale signs abound, almost matched by signs offering properties for rent. On Caprezzo Way a five-bedroom, three-bathroom house, complete with pool, is on the market for $550,000, probably $100,000 less than it would have been advertised for a year ago. Across the street a more ominous sign of the mortgage foreclosure crisis is taped to the wrought iron gate of a stucco house on Cortino Way. “Notice to quit,” it declares, telling the defaulting occupants they have three days to leave.

Guardian