A new commentary on foreclosure and delinquency rates nationwide was published by MetroTrends, the Urban Institute’s web-based report card on social and economic trends in metropolitan America. The data provide a comprehensive look at housing market stress by investigating the number of seriously delinquent mortgages, defined by the Mortgage Bankers Association as mortgages that are 90 days or more delinquent as well as those that are in foreclosure. By examining seriously delinquent mortgages as opposed to just those that have officially entered the foreclosure process, the researchers broaden the scope of prior studies on the depth of the foreclosure crisis.
The analysis of the data underscores the persistence and severity of the foreclosure crisis. Across the metropolitan areas examined by the authors, 7.7% of all mortgages were, on average, seriously delinquent in March 2009. By March of 2010, the rate of serious delinquency had risen to 10.2%. The extent of the delinquency and foreclosure crisis does, however, vary across the country. Austin, TX, had the lowest share of seriously delinquent mortgages nationwide in 2010, with a rate of only 4.4%. Austin’s rate increased 1.3% between 2009 and 2010. At the other end of the spectrum was the Miami metro area, where a nearly inconceivable 26% of mortgages were seriously delinquent as of March 2010. This rate constitutes an increase of 6.6% over the 2009 rate.
While California led the country in foreclosures at the start of the housing crisis in 2007, Florida metro areas suffered the most over the past year, the authors found. The rate of foreclosure and delinquency in the five hardest-hit metro areas in California averaged 16.6% between March 2009 and March 2010, while Florida’s top five hardest hit metro areas (Miami, Orlando, Lakeland, Tampa, and Bradenton) had a foreclosure and delinquency rate of 21.2%, up 5% from 2009. Eight out of the top 10 metro areas nationwide with the highest serious delinquency rate were located in Florida.
The authors cite high unemployment and large declines in housing prices as key factors contributing to high rates of serious delinquency. While delinquency rates continued to rise nationwide, communities with a significant gap between income and average home prices saw the most alarming rates of increasing delinquency. The authors identified Bridgeport, CT; Salt Lake City, UT; and Charleston, SC, as metro areas of concern due to sharply rising serious delinquency rates and suggested further research to explore the causes behind the increasing instability in these communities.
Commentary on the new data can be found on the Urban Institute’s Metro Trends webpage at: http://metrotrends.org/Commentary/foreclosure.cfm
The full data set can be found on the Foreclosure Response web page at: http://www.foreclosure-response.org/maps_and_data/metro_delinquency_data_tables.html. Foreclosure Response is an online guide to foreclosure prevention and a collaboration of the Center for Housing Policy, KnowledgePlex, Local Initiatives Support Corporation (LISC), and the Urban Institute.