The financial crisis happened 10 years ago — that's how long it took this man to sell his house

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For Ryan Dezember, the first hint of the 2008 financial crisis was the smell of hot garbage.

"I started smelling just...  hot garbage, and it was the house next door," Dezember, who is now a reporter for the Wall Street Journal, told The Current's guest host Michelle Shephard.

"So I went over there to see my neighbours, or see if I could take their garbage to the curb — and they were gone.

"No note, no For Sale sign, no trace of them, they were gone. They hadn't even bothered to take out the trash."

That was 2007. Dezember was a young newlywed working as a reporter for a local Alabama newspaper.

He and his wife had bought a small house just inland from the Alabama coast, for $137,500 US. They decorated, planted saplings, and settled into what they thought would be the American dream.

One neighbour overdosed in the middle of the day and was wheeled out in a body bag as the school bus was dropping off the kids.- Ryan Dezember

A year later, that dream was shattered, thanks to a one-two punch of the financial crash and personal turmoil.

Dezember's marriage was ending, but when he tried to sell the house, he found the value had fallen. He now owed far more money on it than he could sell it for. It would be another 10 years, and tens of thousands of dollars, before he could sell his former dream home.

On Sept. 15, 2008, the investment bank Lehman Brothers collapsed, triggered by the subprime mortgage crisis. Those mortgages were given to people with low credit scores, who subsequently couldn't afford them when rates went up. As people started defaulting, housing prices plummeted.

It was the beginning of a financial meltdown that saw global markets fall drastically, driving housing prices even lower. In the following years, more than nine million Americans lost their homes, mostly to foreclosure. 

As unemployment rose in Dezember's neighbourhood, roughly a third of the homes were foreclosed on, he said. It had a catastrophic effect.

"When people lose a reason to get up in the morning a lot of bad things happen," he told Shephard.

"Opioids became a huge thing in my neighborhood," he said,

"I would go out to get the paper in the morning and neighbours would already be drinking beer.... One neighbour overdosed in the middle of the day and was wheeled out in a body bag as the school bus was dropping off the kids for the afternoon."

Punished for doing 'the right thing'

Dezember said he wouldn't walk away, as some neighbours had.

"No one had tricked me. I knew what I was doing when I bought the house and I, you know, certainly felt an obligation to repay it."

When he moved to Texas and then New York for work, he rented it out and kept sending monthly cheques back to the bank in Alabama, paying for a house he didn't want and couldn't get rid of.

As the years went on and the economy slowly recovered from the crash, he found it galling to watch people who had lost their homes re-enter the market. People who had been foreclosed on saw their credit reinstated after a certain number of years.

The question that has come [from the crash] is: 'Is homeownership necessary for the American dream?'- Ryan Dezember

"I'm sitting there thinking: 'Well, so the people that walked away can buy a house, and here I am still trying to pay for the one I own next to the people who walked away,'" he said.

"[People were] basically punished for sticking to it and doing what they were supposed to do."

Dezember thinks the crash has fundamentally altered attitudes to homeownership.

"The question that has come [from the crash] is: 'Is homeownership necessary for the American dream?'" he said.

"The financial crisis was so scarring that there will be people who choose to rent, even though they have the money to buy."

That "big shift" could have implications for later life, if people aren't buying homes and building investments, he said.

Selling up, saying goodbye

Last year, Dezember finally managed to sell the house. He tried to estimate how much money he had lost in 10 years, after tabulating maintenance costs, losses when tenants skipped town, and selling the house for less than he paid for it. He stopped counting at $60,000 US.

"On a house that I only paid $137,000 for, that's pretty tremendous."

When he went down to Alabama to sell the house last year, he stood in the backyard and said his goodbyes.

"I'd bought the house with such hope and good feeling, and to have it turn into this weight and burden, it was sort of sad.

"It was unusual to have sentimental feelings about something that caused so much pain."

Listen to the full discussion near the top of this page.

Written and produced by Willow Smith.