Harsh, economic realities at Smith Mountain Lake

In the go-go days earlier in this decade, Smith Mountain Lake stood proud as the poster child for conspicuous economic consumption with million dollar homes, six-figure speedboats and a lavish lifestyle that revolved around good times, easy credit and stretched finances.

But the economic recession brought reality to the lifestyle of the not-so-rich and more infamous than famous.

Bankruptcies, unfinished projects and empty, foreclosed homes now line the lakefront and surrounding areas.  Smith Mountain Lake developer Edward “Trey Park” listed more than 100 creditors and $50 million in debts when he filed for bankruptcy in 2009. In June of this year, Timothy Scott Banks and Adam Spruill, two high-flying 3o-something mortgage brokers admitted guilt in a fraud scheme that bilked housing lenders out of $7 million on Smith Mountain Lake properties.

Weeds fill the parking lot of a planned — and now abandoned — upscale retail area. Only nine homes of a planned 1500 residences were built in the now foreclosed Sunset Cay development and those nine were auctioned off. All but two sit empty.

Along the lakefront that sprawls through Bedford, Frankin and Pittsylvania counties, multi-million dollar homes sit empty, abandoned by those who walked away from huge mortgages they could no longer afford to pay.  Most of those mortgages are “underwater,” meaning the previous owners owed more than the property is worth.

Smith Mountain Lake’s list of bankrupt, former high-flyers also include Bridgewater Point Parters and Bridgewater Grande Partners, developers of projects at Bridgewater Pointe at Hales Ford.

Bridgewater Pointe, a mid-rise condo unit at Hales Ford, sat empty for nearly two years before Atlas Companies, hired by mortgage holder Baltimore Bank & Trust to liquidate the property, sold off the 48 units last month in a lottery.

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5 thoughts on “Harsh, economic realities at Smith Mountain Lake”

  1. What’s really terrifying to contemplate is that the U.S. is going to devolve into weed grown parking lot from coast to coast. The banking and mega-insurer knaves along with their Congressional facilitators that created this nightmare have skated with little more than a slap on their wrists along with massive bailouts courtesy of captive U.S. tax debtors. / : |

    We’re engaged in adventuristic wars in Iraq and Afghanistan that we can ill afford while expanding our imperialistic influence to the coastal waters of China, steaming about, seemingly cruising for a bruising courtesy of the Chinese if necessary. They are now in the production phase of a missile specifically designed to kill aircraft carriers; ie., send them to the bottom with a single launch. So much for our control of the high seas in faraway places on earth. The beat goes on…!

    Our leadership has abandoned us and are truly are out of control, representing the worst core rot any nation could have in its final throes; e.g., the Roman Empire, the Byzantines, Soviet Russia etc. We’re flat broke yet our duly elected crimpols are steaming the USS America ahead at flank speed into an iceberg field of terminal insolvency.

    The phenomenon of “Smith Mountain Lake” can be found throughout the U.S. and will be getting far worse before the total collapse of our short-lived paradigm, that of another failed empire headed for the ash bin of history.

    Carl Nemo **==

  2. Several years ago, I was amazed at the growth around SML. I worked for VDOT and did a LOT of work out there related to that growth. In summer 2006, just before I left VDOT because I foresaw the layoffs and cutbacks coming, I saw a marquee on a bank at SML advertising a 40-year home loan. When I saw that, I knew the economy was going to tank with housing being the primary reason why. I had seen the years of gimmicky ARM loans and interest-only loans so people could buy a $300K home with a $40K salary, and knew that there would be thousands, perhaps millions, of defaults as those folks could never afford a normal payment on those homes. The 40-year mortgage banner was just the final cap on that. Shortly thereafter, I joined the private sector and we saved our money to buy a modest home, that has defied the market and gained value while so many others have gone underwater.

  3. Now that Fannie May and Freddie Mack are owned by the Government which in the long run is Us the taxpayers, We, yes, We are paying for all those foreclosures and the ones that gave out the loans walk scott free, no penalties
    so far it’s about 50 billion dolors and expected it could go as high as 390 billion and we will pay for it all not the banks that gave out the loans
    I think all the banks and lenders that gave these loans out should pay as much
    This is what I meant in other post that we REALLY need to attract new jobs to this area, or were just not going to recover, I think there are over 400 homes for sale in Floyd Co. right now , people are leaving here

  4. Wouldn;t surprise me if a lot of the folks leaving Floyd are trying to get closer to their jobs. When gas was cheaper, living out in the rural parts of the region was appealing: cheaper homes with more land. But as gas has gone up, it’s leveling out on costs and when it spikes into the $4 range, it’s almost no longer worth it for some, unless you drive a motorcycle or tin can on wheels. I know for me, I spend $150 a month in gas for my truck for commuting, and my drive is only 30 miles a day. There are times I wish we could have afforded to build closer to where I work, but that would have run far more than the $150 a month in gas.

  5. I wouldn’t necessarily make the assumption that people are leaving Floyd. If there are an unusually high number of homes for sale at present, it could be because homes are taking longer to sell, and this creates a backlog of unsold homes. Two different real estate appraisers have told me recently that, whereas in the past, they would have 20 to 30 homes sold within a certain time period for comparison, it is now difficult to find 7 or 8 comparable, recently-sold homes. It does seem as though there have been more foreclosures over the past two years.

    We’ll know more about Floyd’s population shifts when the 2010 census results are available.

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