Cities have been devastated by falling property taxes, fueled by both falling property values and a growing number of properties for which no property taxes are being paid. Property taxes continue to fall as the valuations catch up to the new market values, and now a long-predicted “second wave” of foreclosures is likely to damage the property tax base even further, not to mention devastate homeowners and neighborhoods at the center of this second wave.

For the past year, the growing “shadow inventory” of homes in or on the edge of foreclosure has loomed over Maryland’s housing market. Homeowners and policymakers, especially in hard-hit areas such as Prince George’s, feared that once it was unleashed, it would depress home prices and prolong a housing slump.But the second wave of foreclosures is unlikely to be as devastating as the first one, experts said, because it coincides with a housing recovery that is making it easier for banks to offload distressed homes.

Small consolation for the actual homeowners, of course.

via Thousands of Marylanders are losing homes in second wave of foreclosures – The Washington Post.