Monday, March 23, 2015

Foreclosures continue to hurt Rochester neighborhoods

Posted By on Mon, Mar 23, 2015 at 10:27 AM

For some time now, government reports have painted a fairly upbeat picture about the winding down of the foreclosure crisis and the rebound of the real estate market. But that’s taken from a national overview.

An analysis from Empire Justice Center, “Eye of the Storm: Why the Threat of Foreclosure Damage Continues,” gives a sobering look at the impact of foreclosures in Rochester and Monroe County over the last five years. And the report says that the foreclosure crisis will continue in this area for at least two more years, even though we are supposed to be in an economic recovery.

Empire Justice Center’s key findings:

The national foreclosure rate declined by 50 percent from its peak of 4.1 percent in 2010 to 2.1 percent in June 2014; but Monroe County’s foreclosure rate peaked at 3.9 percent in June 2012, and remained constant.

Declines in Monroe County’s mortgage delinquency rates (mortgages that are about to go into foreclosure) have stalled at 3.3 percent since June 2011, which suggests that the “foreclosure pipeline” continues.

As of the beginning of 2014, 70 percent of the 3,504 foreclosures filed on city properties from 2009 through 2013 were still pending in the court system.

And foreclosures are most heavily concentrated in communities of color, which disproportionately affects African American and Latino homeowners and their neighborhoods. 

"This is not only an economic issue, it's an issue of racial justice," said Michael Hanley at a press conference last week. Hanley is the the main author of the report.

It’s the latter finding that is most troubling, because a mix of foreclosure-related factors pulls down all property values in neighborhoods with high concentrations of foreclosures – making it difficult to sell or lend in those neighborhoods. Neighborhoods become ensnared in a downward spiral of vacant, boarded-up, and neglected properties which causes the nearby homeowners who are current on their mortgages to lose value, too.

Foreclosures on investor-owned properties are particularly damaging in these neighborhoods. Rochester has a high percentage of properties that are investor-owned. Of the 2,506 properties pending foreclosure as of September 2013, 52 percent were investor owned and 75 percent were vacant.

Empire Justice says that state and federal intervention is needed to assist homeowners trying to settle with banks, and that officials must require lenders to expedite the loan modification process. Empire Justice says that municipalities need better information about property ownership, outstanding mortgages, and taxes. And they need greater leverage to intervene instead of allowing properties to languish in foreclosure.



Tags: , , ,

Speaking of...

Comments

Subscribe to this thread:

Add a comment

Readers also liked…

Latest in News Blog

More by Tim Louis Macaluso

Browse Listings

Submit an event

© 2016 City Newspaper.

Website powered by Foundation.