Foreclosed Properties Data Articles

The rising number of repossession homes and the uncontrolled growth of housing have been eroding the tax base of county and city governments and their ability to serve their constituents, according to a report from the Auburn University Center for Governmental Services.

Auburn researchers studied housing growth data from the U.S. Census Bureau for the states of Georgia and Alabama from 2000 through 2008 and compared them with data on property taxes.

The analysts, led by Don-Terry Veal, said that Georgia had a much faster rate of housing growth for the 8-year period than Alabama, so when the housing meltdown started, Alabama was in better condition to survive the storm. Most Alabama counties will not experience the tax problems that many Georgia counties will suffer due to the record numbers of foreclosures.

From 2000 through 2008, a total of 744,000 new housing units were built in Georgia, marking a 22.4-percent housing growth rate and putting Georgia in fourth place across the U.S. in terms of housing growth. On the other hand, Alabama built only 195,000 new housing units, marking only 9.9 percent in growth and putting the state 24th in charts of housing growth in the U.S.

The number of repossession homes was also far higher in Georgia than in Alabama. Based on data from a foreclosure research firm, Georgia has already posted 92,611 foreclosure properties in 2009, compared to only 14,963 units in Alabama.

Georgia’s foreclosure rate of 2.3 percent of all existing homes is nearly 4 times higher than that of Alabama, which has a foreclosure rate of only 0.6 percent.

The Auburn researchers estimated that foreclosures in Georgia will cause a total revenue loss of nearly $249 million in 2009, using the Tax Foundation’s $2,684 estimate of the typical property tax paid by a regular household in Georgia.

In comparison, Alabama is expected to lose only about $16 million in property taxes in 2009 because of its much slower foreclosure pace and its lower property tax estimate of only $1,080 for every household.

David Hill of the Center for Governmental Services said that the center is not against housing developing projects, but that cities and counties need to monitor huge housing growth rates because of the high cost of supporting growth in infrastructure and expanded services in areas with unprecedented housing growth rates.

Recently, the researchers found that four of the fastest growing counties in Georgia were among counties with the biggest number of repossession homes in August throughout Georgia.

Government foreclosed homes in Montague City, Michigan were acquired last week by GSMB LLC from the U.S. Department of Agriculture. The two-building apartment properties called Channel View were foreclosed by USDA in 2007, when there were only a few tenants.

Today, as the apartment properties are being renovated at a cost of more than $1.5 million, nearly all the units are occupied.

Before the closing of the sale, Gary Shaw, co-owner of GSMB, asked city officials of Montague to provide his firm with the city’s Payment In-Lieu of Taxes incentive so his company can work within a certain budget to rehabilitate the properties.

Shaw also argued that since his firm was expressly instructed not to increase rent levels, his company needs the PILOT incentive. The apartment units are classified as Equal Housing Opportunity housing units.

The council granted Shaw’s request and voted to provide him with four-percent PILOT. The city has not collected taxes on the apartment buildings since 2007 when the properties were seized by the USDA and became government foreclosed homes.

To rehabilitate the apartment properties, GSMB took out a $1.534 million loan. Among its planned repairs and improvements are the replacement of siding and roofs, remodeling of common areas and interiors and installation of energy-saving windows and water and heating systems.

According to Shaw, his company is experienced in renovating apartment buildings. His firm has also recently acquired and renovated two apartment complexes in East Tawas which were built by the same construction firm that built Channel View. He added that the apartment units have almost identical layouts.

Shaw also said that the renovation work would create employment opportunities for local contractors. His firm is now accepting bids for the work, according to Shaw.

Next year when all the apartment units have been renovated and occupied, the city government will inspect the properties and then set the rental rate, which could increase or remain unchanged. If the rent increases, the amount of money to be earned by the city through the PILOT scheme would also increase.

During the interview with city officials, Shaw was asked why he purchased the properties despite the rental limits and the rehabilitation expenses. Shaw said that his firm received a developer’s fee and that he was given the option to rent out the government foreclosed homes outside the Equal Housing Opportunity restriction after 30 years of paying the mortgage.

The number of homes foreclosed in Erie County, New York in August declined, based on data from the Office of the Erie County Clerk.

While foreclosures increased in many areas of the country in August, total home foreclosures in July and in August in Erie County dropped to their lowest points in more than 5 years. Foreclosure figures during other months of 2009 also showed that the foreclosure process is slowing down in Erie.

For the first 8 months of 2009, completed foreclosures throughout the county dropped by 35 percent to 930 units compared to foreclosures in 2005. Default filings this year decreased by 15 percent compared to filings in 2008 and decreased by 20 percent compared to filings in 2005.

According to Kathleen Hochul, clerk of Erie County, foreclosure filings in the third quarter also indicated the county’s lowest foreclosure pace since 2004. Foreclosures in July and in August were down by 40 percent compared to the same months last year. Hochul also said that foreclosure forecasts have been positive for existing homeowners.

Meanwhile, in another study conducted by the Western New York Law Center, a total of 424 homes foreclosed were posted in Erie County in the third quarter, a drop of 23.7 percent from foreclosures in the previous quarter and a 26.8-percent drop from the third quarter of 2008. The number is also the lowest quarterly figure recorded since 2006, except for the fourth quarter of last year when there were only 329 foreclosures.

The fourth quarter however of 2008 was the time when the state of New York implemented a 90-day foreclosure moratorium.

As residential foreclosures declined, commercial foreclosures climbed up. A total of 21 commercial properties were foreclosed in the third quarter, an increase of 13 percent from the previous quarter.

Kathleen Lynch, a senior attorney at Western New York Law Center, credited the stepped-up initiatives by the federal agencies and lenders for the drop in foreclosure postings in Erie County. In contrast to complaints against government programs in other areas, loan modifications in Erie County have been effective in containing foreclosures.

Lynch added that more homeowners in Erie have been contacting counseling agencies and seeking help before they even receive their first foreclosure notice.

According to Lynch, about 70 to 90 percent of all the clients of three of the biggest counseling agencies in Erie have sought help immediately after they missed payments. Indeed, early foreclosure intervention would cut down the number of homes foreclosed in any community.

The increase or decrease in the number of Federal Housing Administration repossession houses across the country will be a huge factor in the ability of the FHA to weather its falling cash reserves.

Unless you are paying in cash, buying an FHA foreclosure home needs loan pre-qualification. This is an essential process to ensure that you are qualified for an FHA home loan before you spend precious time, effort and money looking for an FHA foreclosed home.

Repo properties for sale and short sales accounted for 31 percent of all sales of existing homes in August, based on a report released by the National Association of Realtors.

Purchasing foreclosed homes in San Joaquin Valley and rehabilitating them for lower-income families is the main goal of the consortium called California Partnership for the San Joaquin Valley in asking for $193 million from the second funding round of the federal Neighborhood Stabilization Program.

You can buy a foreclosed home for sale under the Fannie Mae lease purchase program while you are still building up your credit record and saving up for your payments.

Investing in a foreclosure property is a viable and affordable option to secure your financial future, according to data compiled by foreclosure research analysts.

Buy foreclosed houses now because home prices will increase in 2010, according to a majority of 41 economists surveyed by Reuters.