The Real Estate Wranglers

"Hello, and thank you for calling the Foreclosure Hotline!" is how the recording begins. "Did you know that nowadays you can buy a house for about 40 percent less than what it was going for just one year ago!" The voice, a barely controlled yell with an Italian accent, belongs to Alessandro Chiocchetti. He advertises his Foreclosure Hotline on hand-written signs all over Las Vegas. "That's called Italian creativity," he says.

Chiocchetti drives customers around in his late model Audi; it still has that new-car smell. He's lucky he bought it while his business was still booming; he might not be able to afford it now. Chiocchetti came to Las Vegas from Milan six years ago, just as the real-estate boom was kicking in to high gear. By 2005, at the peak of the market, he was making a killing: helping some folks buy dream houses, others sell them. And bringing in nice commissions either way. But his business came to an abrupt stop in 2007. The first wave of subprime borrowers was defaulting on loans, and as more homes went into foreclosure, the market collapsed.

Chiocchetti had to learn to adapt, fast. Now he specializes in helping people jump through the many hoops involved in buying foreclosed houses. Half his customers come from outside the United States. "I have many Canadians," he says. "Honestly, they find our prices quite ridiculous."

When he takes buyers to check out houses, he becomes an unwitting tour guide around Foreclosure City; each house is a window into another failed American dream. Chiocchetti says it can get depressing. But, he's got to make a living. If you see an opportunity to make money, you seize it. That's part of the American dream too, isn't it?

Chiocchetti never knows what to expect when he's showing houses to clients these days. "It can be dangerous," he says. Squatters live in some of the foreclosed houses now. Other homes are still occupied by owners looking for a buyer at almost any price. It's called short-selling: getting rid of the house for whatever it will sell for, and hoping the bank will agree to write off the rest. Chiocchetti is checking out one of these houses.

He rings the doorbell. A little boy peeks out. "They're here to take away our house!" he yells. A man comes to the door. His name is Mike Heger. That's his grandson, he says. Things are chaotic. They're moving out.

Boxes are stacked in the foyer, and on the curb a pile of books, kitchen utensils, old magazines, a pair of slippers. "Just stuff," Heger says, looking down at it. "All the various things we've accumulated."

Heger was a field engineer by trade who moved from Utah to Las Vegas at the height of the housing boom, to try his hand at buying and selling real estate. It was a lucrative business, a way to make big money, fast. Heger bought two houses in Las Vegas. Small-time speculators like him were all over the city then, making a living by flipping houses as values went up. Many people now blame these speculators for artificially driving up prices. But Heger ended up a victim too.

When the market collapsed, he couldn't sell one of his houses. The bank took it. Now he's about to move out of the other house, the one he lives in with his family. He stopped making payments about a year ago. His family is moving into a rental unit across town, while their credit is still good enough to get a landlord to lease to them.

"It's a smaller house," he says, but he is trying to keep things in perspective. "It's all about having family together. You know, just keep family together." Heger has had no luck finding a new job; his family is living off the small savings he has left. But he is getting some offers on this house - for nearly $300,000 less than he bought it for, but offers all the same. It's a relief. If he can sell, at least he won't have another foreclosure on his credit. "So I'll be able to buy a new house a lot sooner," he says, already looking toward the future. "You can either panic with fear, and lose your house, and lose your mind. Or you can work something out, and you can actually thrive." He pauses. "I know I might sound like an optimistic fool, but there's always a way."

This article was originally published in May 2009. The following corrections were made in September 2011:

*An earlier version of this article erroneously stated that Mike Heger quit his job in construction. He did not work in construction. He was a field engineer who started a business investing in real estate.

*An earlier version of this article stated that Mike Heger bought several houses in Las Vegas. He bought two houses there. He bought two others in Utah.

*An earlier version of this article misstated that Mike Heger lost all of his houses. He made money off the two houses he bought and sold in Utah. In Las Vegas, the bank foreclosed on one of his houses. He was facing foreclosure on the other when this story was originally reported, but ended up "short-selling" the house at a loss.

Back to Foreclosure City.