52% of 2008 Foreclosures Were In Only 5 States
RealtyTrac, the leading online marketplace for foreclosure properties, today released its 2008 U.S. Foreclosure Market Report, which shows a total of 3,157,806 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 2,330,483 U.S. properties during the year, an 81% increase in total properties from 2007 and a 225% increase in total properties from 2006. The report also shows that 1.84% of all U.S. housing units (one in 54) received at least one foreclosure filing during the year, up from 1.03% in 2007.
MP: If you take out the six states with the highest foreclosure rates (CA, FL, NV, AZ, MI and OH), the 1.84% foreclosure filing rate drops to only 1.1%. Further and probably more importantly (although not reported by RealtyTrac), my analysis of the RealtyTrac data shows that more than half (52%) of the 2008 foreclosures were concentrated in just five states: Arizona, Florida, California, Michigan and Nevada.
Update: Those six states have 28% of the U.S. population, and 52% of the 2008 foreclosures.
9 Comments:
Imagine that?
Fitting that these states are the "Bluest of the Blue" states
Mark, Is there any way to determine home owner from investor in that data? I am in south FL and can tell you that speculation in condos and single family homes was rampant (which is no suprise to anyone). But it would be interesting to see how the actual homeowners are holding up.
All of which proves that Forced-Unionism is wrong!
FL, AZ, NV are the "Bluest of the Blue" states?? What world do you live in? When is the last time AZ voted Blue?
Even OH was controlled by Republicans a few years ago (when most of these subprime loans were written) until they messed up the state. (See Bob Taft, Coingate scandal)
Having said all that, it doesn't matter where the foreclosures were concentrated. AIG had a lot of profitable businesses, but writing insurance on CDOs brought the whole company down.
The real reasons the foreclosure crisis is hitting those areas the hardest is:
OH, MI have been hurt the most by the contraction of the auto industry.
AZ, FL, NV and CA had a real inbalance between supply and demand. Everyone wanted to live in those states and there was a shortage of housing. However, as unregulated markets tend to do from time to time, the market became irrational, leading to the bubble and now the bust.
So your point is that 6 out of the 50 states account for .74% of the 1.84% of homes applying for foreclosure (i.e. 6 states (6/50=12%) account for 0.74/1.84= 40% of the foreclosures filed).
This should really be calculated based on populations, not the number of states. Based on population the six states you mentioned (CA, FL, NV, AZ, MI and OH) total estimated 85.7 Million people out of an estimated 304.1 million people in the US in July 2008 http://www.census.gov/popest/states/NST-ann-est.html
Using population these states represent 28.2% of the US population which is a lot closer to the 40.2% of foreclosure filings in those states.
Your point is still valid, just slight exaggerated. If we really wanted to look at the problem we should weight the number of foreclosures in each state to population, or total residencies or something similar. Thanks for the post as always, very interesting.
I think that Michigan, California, and Florida have strong housing and zoning codes that tend to artificially raise the price of homes (but not necessarily the value).
Those artificially imposed costs would appear in the mortgage when a home was new, but might not translate into either community value of homw value later.
The disproportionate fall in value, then, might translate into a disproportionate number of foreclosures in those areas.
Hydra
"The real reasons the foreclosure crisis is hitting those areas the hardest is:
OH, MI have been hurt the most by the contraction of the auto industry."
mach as usual is wrong again...
Liberal policies by Dems has run rampant in Ohio and Michigan for decades, hence the problems...
mach you know that already...
Obama Appealed to the Stupid
FYI, states which are neither consistently red nor blue - e.g. FL,NV,OH are now sometimes called "purple" states.-
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