How does foreclosure in real estate affect the public?

How does foreclosure in real estate affect the public?
It's a snowball effect. The more people who foreclose, the tougher the banks get. The tougher the banks get, the harder it is for buyers to get approved for a mortgage. If people can't qualify for a mortgage loan, the more properties for sale there are on the market that are unable to get sold. Lots of houses on the market decreases demand. Less demand means less profit. Less profit means real estate values go down.

In addition, neighborhoods are affected. If one or two people on a single block foreclose, the bank takes it over. That means the lawn stops getting mowed, the pool turns black, and the block starts to look less attractive to buyers. Who wants to pay top dollar for a neighborhood like that? Again, real estate values go down.And it doesn't stop there. If a seller can't make a profit by selling their house, it affects their spending habits. They will spend less money on other things such as home improvements and even on their regular shopping. Now the local contractors, plumbers, electricians and the neighborhood shops and restaurants are making less money. If a company stops making money, they will have to close and/or cut down on staff. Any employees affected are now unemployed. Now you have even more people trying to spend less money because they can't find work.I could go on, but I'll stop there, you get my drift. Real estate foreclosures DO affect more than real estate.PS - I am a licensed Florida real estate agent. I see this snowball effect every day and it breaks my heart. It affects my friends, my associates and my family.