The Florida city of Cape Coral has fallen far from its luster at the height of the real estate bubble. Now the only bright spot in the city’s house market is the blazing green bus that can been seen driving around giving tours of real estate owned (REO) properties in the city.

The incredibly depressed values of these homes have become tourist attractions for the retirement community.

Cape Coral, much like the cities of California, was plagued with the real estate Ponzi scheme of speculators selling to speculators, driving prices into the stratosphere and out of the hands of long-term investors and buyer-occupants.

Now companies are trying to pull in potential out-of-town speculators who hope to make a quick buck off of the REO inventory.

first tuesday take: This may be a grim prelude of where California is headed as the REO inventory starts to pick up this year — garish and aggressive attempts to make easy money off of a bad situation with no long term commitment to the communities involved. San Diego is already experiencing similar money-making schemes.

In the next few months once California is clear of government delays and interference in the state’s foreclosure process and lender bookkeeping, and the lenders move beyond the “extend and pretend” of temporary modifications and begin to issue notices of default (NODs) the foreclosure tide will return afresh.

Re: “Real Estate in Cape Coral Is Far From a Recovery,” from The New York Times