Monday, July 14, 2008

Montgomery County In Foreclosure: Graphing the Subprime Crisis

Esrati had an interesting post about problems with banks maintaining their properties (as well as making a tongue-in cheek-suggestion that I map this).

Instead of mapping, which requires things I don't have, namely GIS knowledge and access to the Auditors database, here are some quick charts from the online query tool at the County Auditors website. These track the growth of the foreclosure crisis in Montgomery County by tax year, based on number of holdings of various entities.

First, looking at Deutsche Bank, which was mentioned in the article at Esrati.

Pretty clear how DB is owning more and more parcels (the unit of measure at the Auditors site) as the crisis builds, but appears to have started to plateau.

Next is Fannie Mae, since it's in the news. This institution had an impressive jump in holdings in 2005, and is still holding the bag on quite a few properties in Montgomery County

Next, HUD. Presumably HUD is holding some foreclosures, too.

So what happens to these properties? The banks want to get rid of them, and there are buyers. One is locally based Performance Home Buyers LLC, which had an interesting article in the Dayton Business Journal back in 2004. They buy houses from distressed owners, but also foreclosed properties from banks, as per this excerpt:

"Wherever there are blue-collared working neighborhoods, that's where we are," Hawkins said. "We're rehabbing the customer's credit as well as the properties. We're trying to bring the neighborhoods up. It improves our collateral."

Performance looks for homes in a distressed situation, meaning they are likely to be purchased from a bank following a foreclosure, said Randall Porter, Performance managing member.

Here is their growth (they started in 2000 I think)

…they also buy from estates, according to the article. So if your Ma or Pa die and you can’t sell the house they will buy it from you. This sounds sort of macabre, but they are recycling the property back into the housing market, which is a good thing. An alternative to boarding up and demolition.

What’s noticeable is that there isn’t much growth in their holdings after the 2004 & 2005 peaks, which could mean they have as much property as they could handle (I am not familiar with the company so would appreciate any lurkers to provide some intel).

Finally, the largest owner in Dayton is the City of Dayton. These properties could be a lot of different things, not just houses. They could also be vacant lots. What’s interesting, compared to the other graphs, is how stable this pool of property is.

The Auditors database, limited as it is, can be of good use if one is interested in neglected properties, to find out who the owner of record is. Since one can sort by street address one could build a picture of what’s going on in a particular neighborhood in terms of ownership, and even track trends since the database goes back to 1999,

1 comment:

Anonymous said...

great article. I think the peak of the subprime crisis will come end of 2008. let's hope for the best in 2009.