Catching up with a friend of mine - who'd bought into the Florida Real Estate boom of the 2000's last I heard.

His story:

2 houses bought in 2007, approx. $240K each. $24K + $4K costs put down for each house.

Each house is worth about $100K now.

One house was 'short saled' and the $240K loan paid off for $100K in cash.

The other remains at approx. -$130K equity.

Basically the rents from both houses are equal to the carrying costs - after the short sale. The hope now is that this rent situation can continue for the next 27 years until the negative equity loan is paid off or house prices go up significantly.

Without the very fortunate short sale, my friend would be in grave trouble indeed.