Home foreclosure rates in Ohio and western Pennsylvania (August 2011) (Pittsburgh: real estate, foreclosures)

[Craziaskowboi]

This information courtesy of the Cleveland branch of the Federal Reserve. Here's a map:



From what I've heard, Pennsylvania really stiffened the penalties for predatory lending practices sometime early last decade (I want to say 2002 or 2003). If that's true, then it's fortuitous because 2003 is when the real estate bubble began to inflate in this country. It turns out to have been a very sensible regulation, because that's a hard boundary at the Pennsylvania/Ohio state line.

[PeterRabbit]

That's interesting, especially the border wall. I wonder what the rest of our state looks like since we both have about the same population.

I knew a govt. social worker in East Liberty and he said in the early 2000s anyone applying for assistance had to fill out a form which heavily asked about mortgage practices. It was fairly common to see people with a net income of $700 having a $725 mortgage at higher than average interest rates.

Your link won't open at the moment. It's hard to believe we look so lily white compared to Ohio. I guess standards were looser there?

[gg]

Those are shocking percentages.

[BrianTH]

Some of that is also differences in corporate culture at National City versus PNC, and also relative dependence on the auto industry. Still, though, it is very rare to see a state border matter that much, which does imply an important legal difference.

[kjtocool]

http://www.clevelandfed.org/CFFileServlet/_cf_image/_cfimg-6076425426741131477.PNG (broken link)

Did you purposefully leave out the map with homes 90+ days delinquent, which is a pre-cursor to foreclosure?

I think this chart is even more interesting. Why do we have similar delinquent percentages, but significantly lower foreclosure rates? Different banking principles? Hold up in PA on filing foreclosures?

[Craziaskowboi]

Originally Posted by kjtocool

Did you purposefully leave out the map with homes 90+ days delinquent, which is a pre-cursor to foreclosure?

I think this chart is even more interesting. Why do we have similar delinquent percentages, but significantly lower foreclosure rates? Different banking principles? Hold up in PA on filing foreclosures?

First of all, you might want to repost the map. Second of all, the percentage of delinquent homes is probably similar because most of those that were delinquent in Ohio have already been foreclosed on. That means that even if every delinquent home in Pennsylvania and Ohio goes into foreclosure, the foreclosure rate in Pennsylvania will still remain far below the foreclosure rate in Ohio.

[bradjl2009]

Originally Posted by Gnutella

This information courtesy of the Cleveland branch of the Federal Reserve. Here's a map:



From what I've heard, Pennsylvania really stiffened the penalties for predatory lending practices sometime early last decade (I want to say 2002 or 2003). If that's true, then it's fortuitous because 2003 is when the real estate bubble began to inflate in this country. It turns out to have been a very sensible regulation, because that's a hard boundary at the Pennsylvania/Ohio state line.

That's shocking. Even the counties that are doing the worst in Western PA are doing better than many of the counties in Ohio and Kentucky. I have seen recently though that Pennsylvania and the Pittsburgh area generally rank higher than average when it comes to credit scores and paying bills on time too.

[kjtocool]

Originally Posted by Gnutella

First of all, you might want to repost the map. Second of all, the percentage of delinquent homes is probably similar because most of those that were delinquent in Ohio have already been foreclosed on. That means that even if every delinquent home in Pennsylvania and Ohio goes into foreclosure, the foreclosure rate in Pennsylvania will still remain far below the foreclosure rate in Ohio.

Sounds like I struck a nerve. I still think it's a legitamite question.

You mentioned that the delinquent homes in Ohio have already been foreclosed on. To me, that says that the delinquent chart includes delinquents who haven't been foreclosed, and those who have had the foreclosure process started. A fair assumption, I agree with that.

So let's remove all the foreclosures now. What you're left with is PA having a higher rate of delinquency than Ohio.

Look at it another way, PA has a similar rate of delinquency to Ohio, but for whatever reason, less foreclosures. I'm interested in why our delinquents don't seem to turn into foreclosures, but Ohio's do? Better state aid? Different banking principles? Or is it simply that PA lagged for whatever reason and the foreclosures are about to start rolling in shortly? I don't have an answer, but I'd like one.

http://imageshack.us/photo/my-images...reclosure.jpg/

[BrianTH]

Figures 2 & 3 (which I am having trouble linking directly) at the Cleveland Fed link may help sort this out:

http://www.clevelandfed.org/Communit...1110/index.cfm

As you will see in Figure 2, Ohio started with a higher deliquency rate than Pennsylvania, but as the effects of the recession on deliquency peaked circa the end of 2009, the gap between Ohio and Pennsylvania grew. It has since come back down, but those additional deliquencies are in fact still working their way through the foreclosure system, as reflected in Figure 3--foreclosures didn't peak until around a year later, circa the end of 2010, and basically sat on a plateau through August of 2011 (even as the deliquency rate had been declining).

Incidentally, according to Figure 3, Ohio started with a higher forclosure rate than Pennsylvania and the gap is more or less normal now--it is just that both states are elevated. But none of that really explains the sharpness of the boundary at the state line when you go into the county-level data, which persists in the deliquency version of the map as well if you know what to look for.

[Craziaskowboi]

Originally Posted by kjtocool

Sounds like I struck a nerve. I still think it's a legitamite question.

So let's remove all the foreclosures now. What you're left with is PA having a higher rate of delinquency than Ohio.

If anything, my original post struck a nerve. Let's examine the population of the high-delinquency counties in eastern Ohio and western Pennsylvania:

High-delinquency counties (eastern Ohio)

1,280,122 - Cuyahoga County
238,823 - Mahoning County
210,312 - Trumbull County
107,481 - Columbiana County
101,497 - Ashtabula County
86,074 - Muskingum County
69,709 - Jefferson County
40,087 - Guernsey County
36,901 - Coshocton County
28,836 - Carroll County
14,645 - Noble County

2,214,487 - Total residents in high-delinquency counties in eastern Ohio

High-delinquency counties (western Pennsylvania)

136,606 - Fayette County
116,638 - Mercer County
91,108 - Lawrence County
88,880 - Indiana County
88,765 - Crawford County
68,941 - Armstrong County
54,984 - Venango County
45,200 - Jefferson County
39,988 - Clarion County
38,686 - Greene County

769,796 - Total residents in high-delinquency counties in western Pennsylvania

Now let's examine the population of the low-delinquency counties in eastern Ohio and western Pennsylvania:

Low-delinquency counties (eastern Ohio)

172,332 - Medina County
161,419 - Portage County
114,520 - Wayne County
93,389 - Geauga County
70,400 - Belmont County
61,778 - Washington County
15,864 - Harrison County
14,642 - Monroe County

704,344 - Total residents in low-delinquency counties in eastern Ohio

Low-delinquency counties (western Pennsylvania)

1,223,348 - Allegheny County
365,169 - Westmoreland County
207,820 - Washington County
183,862 - Butler County
77,742 - Somerset County
41,815 - Warren County
7,716 - Forest County

2,107,472 - Total residents in low-delinquency counties in western Pennsylvania

Plain and simple, your argument holds no water because you interpreted the maps by area when you should have been interpreting them by population. The number of people who live in low-delinquency counties in western Pennsylvania is almost triple the number of people who live in high-delinquency counties. Conversely, the number of people who live in high-delinquency counties in eastern Ohio is more than triple the number of people who live in low-delinquency counties. This is why the housing market in western Pennsylvania is in much better shape than it is in eastern Ohio.

NOTE: Just so you're not confused, the two darkest shades on the map illustrate the high-delinquency counties, and the two lightest shades illustrate the low-delinquency counties. The medium shade illustrates the medium-delinquency counties, and are not included in this comparison.