IDEAS home Printed from https://ideas.repec.org/a/taf/chosxx/v30y2015i4p535-559.html
   My bibliography  Save this article

The Foreclosure Crisis and Community Development: Exploring REO Dynamics in Hard-Hit Neighborhoods

Author

Listed:
  • Ingrid Gould Ellen
  • Josiah Madar
  • Mary Weselcouch

Abstract

Since the onset of the foreclosure crisis, many communities have faced a glut of properties that have completed the foreclosure process and are now owned by banks or other mortgage lenders. Policy-makers worry that large concentrations of these properties, referred to as 'real estate owned' or 'REO,' impose spillover effects on the price of homes and quality of life in surrounding neighborhood. Despite receiving significant policy attention, our understanding of the size, nature, and distribution of current REO stocks, as well as what becomes of properties after being sold, is extremely limited or anecdotal. Our paper shines new empirical light on the REO problem in hard-hit neighborhoods by using local data sources to analyze recent REO trends in New York City and the core counties of the Atlanta and Miami areas. For each, we calculate the size of the REO stock over time in different neighborhood types, estimate the types of purchasers, and determine whether purchased REO properties are flipped.

Suggested Citation

  • Ingrid Gould Ellen & Josiah Madar & Mary Weselcouch, 2015. "The Foreclosure Crisis and Community Development: Exploring REO Dynamics in Hard-Hit Neighborhoods," Housing Studies, Taylor & Francis Journals, vol. 30(4), pages 535-559, July.
    • Handle: RePEc:taf:chosxx:v:30:y:2015:i:4:p:535-559
    DOI: 10.1080/02673037.2014.882496
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/02673037.2014.882496
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/02673037.2014.882496?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Stephan D. Whitaker, 2011. "Foreclosure-related vacancy rates," Economic Commentary, Federal Reserve Bank of Cleveland, issue July.
    2. Daniel Immergluck, 2009. "The accumulation of foreclosed properties: trajectories of metropolitan REO inventories during the 2007–2008 mortgage crisis," Community Development Innovation Review, Federal Reserve Bank of San Francisco, issue 1, pages 07-42.
    3. Thomas J. Fitzpatrick & Stephan D. Whitaker, 2012. "The impact of vacant, tax-delinquent, and foreclosed property on sales prices of neighboring homes," Working Papers (Old Series) 1123, Federal Reserve Bank of Cleveland.
    4. Daniel Immergluck, 2009. "Intrametropolitan patterns of foreclosed homes: ZIP-code-level distributions of real-estate-owned (REO) properties during the U.S. mortgage crisis," FRB Atlanta Community and Economic Development Discussion Paper 2009-01, Federal Reserve Bank of Atlanta.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ed Ferrari, 2015. "The Social Value of Housing in Straitened Times: The View from England," Housing Studies, Taylor & Francis Journals, vol. 30(4), pages 514-534, July.
    2. Dan Immergluck & Jonathan Law, 2014. "Investing in Crisis: The Methods, Strategies, and Expectations of Investors in Single-Family Foreclosed Homes in Distressed Neighborhoods," Housing Policy Debate, Taylor & Francis Journals, vol. 24(3), pages 568-593, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Thomas J. Fitzpatrick & Lisa Nelson & Francisca Richter & Stephan D. Whitaker, 2012. "The effect of local housing ordinances," Working Papers (Old Series) 12-40, Federal Reserve Bank of Cleveland.
    2. Kathe Newman, 2010. "Go Public!," Journal of the American Planning Association, Taylor & Francis Journals, vol. 76(2), pages 160-171, April.
    3. Dan Immergluck & Jonathan Law, 2014. "Investing in Crisis: The Methods, Strategies, and Expectations of Investors in Single-Family Foreclosed Homes in Distressed Neighborhoods," Housing Policy Debate, Taylor & Francis Journals, vol. 24(3), pages 568-593, July.
    4. Dan Immergluck, 2011. "The Local Wreckage of Global Capital: The Subprime Crisis, Federal Policy and High‐Foreclosure Neighborhoods in the US," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 35(1), pages 130-146, January.
    5. Alm, James & Hawley, Zackary & Lee, Jin Man & Miller, Joshua J., 2016. "Property tax delinquency and its spillover effects on nearby properties," Regional Science and Urban Economics, Elsevier, vol. 58(C), pages 71-77.
    6. Christopher Niedt & Isaac William Martin, 2013. "Who Are the Foreclosed? A Statistical Portrait of America in Crisis," Housing Policy Debate, Taylor & Francis Journals, vol. 23(1), pages 159-176, January.
    7. Larson, Matthew & Xu, Yanqing & Ouellet, Leah & Klahm, Charles F., 2019. "Exploring the impact of 9398 demolitions on neighborhood-level crime in Detroit, Michigan," Journal of Criminal Justice, Elsevier, vol. 60(C), pages 57-63.
    8. Lynn Fisher & Lauren Lambie-Hanson & Paul S. Willen, 2010. "A profile of the mortgage crisis in a low-and-moderate-income community," Public Policy Discussion Paper 10-6, Federal Reserve Bank of Boston.
    9. Prabal Chakrabarti, 2009. "Massachusetts’ efforts to address foreclosed properties," Community Development Innovation Review, Federal Reserve Bank of San Francisco, issue 1, pages 65-72.
    10. Stephan Whitaker & Thomas J. Fitzpatrick IV, 2016. "Land Bank 2.0: An Empirical Evaluation," Journal of Regional Science, Wiley Blackwell, vol. 56(1), pages 156-175, January.
    11. Chan, Sewin & Gedal, Michael & Been, Vicki & Haughwout, Andrew, 2013. "The role of neighborhood characteristics in mortgage default risk: Evidence from New York City," Journal of Housing Economics, Elsevier, vol. 22(2), pages 100-118.
    12. Johnson, Michael P. & Solak, Senay & Drew, Rachel Bogardus & Keisler, Jeffrey, 2013. "Property value impacts of foreclosed housing acquisitions under uncertainty," Socio-Economic Planning Sciences, Elsevier, vol. 47(4), pages 292-308.
    13. Elora Raymond, 2016. "Negative equity in the Sixth Federal Reserve District," FRB Atlanta Community and Economic Development Discussion Paper 2016-1, Federal Reserve Bank of Atlanta.
    14. Selma Hepp, 2013. "Foreclosures and Metropolitan Spatial Structure: Establishing the Connection," Housing Policy Debate, Taylor & Francis Journals, vol. 23(3), pages 497-520, July.
    15. Ryan M. Goodstein, 2014. "Refinancing Trends among Lower Income and Minority Homeowners during the Housing Boom and Bust," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 42(3), pages 690-723, September.
    16. William H. Rogers, 2010. "Declining foreclosure neighborhood effects over time," Housing Policy Debate, Taylor & Francis Journals, vol. 20(4), pages 687-706, September.
    17. Jeremy R. Groves & William H. Rogers, 2011. "Effectiveness of RCA Institutions to Limit Local Externalities: Using Foreclosure Data to Test Covenant Effectiveness," Land Economics, University of Wisconsin Press, vol. 87(4), pages 559-581.
    18. Whitaker, Stephan & Fitzpatrick IV, Thomas J., 2013. "Deconstructing distressed-property spillovers: The effects of vacant, tax-delinquent, and foreclosed properties in housing submarkets," Journal of Housing Economics, Elsevier, vol. 22(2), pages 79-91.
    19. Daniel Immergluck, 2009. "Intrametropolitan patterns of foreclosed homes: ZIP-code-level distributions of real-estate-owned (REO) properties during the U.S. mortgage crisis," FRB Atlanta Community and Economic Development Discussion Paper 2009-01, Federal Reserve Bank of Atlanta.
    20. Thomas J. Fitzpatrick & Stephan D. Whitaker, 2012. "The impact of vacant, tax-delinquent, and foreclosed property on sales prices of neighboring homes," Working Papers (Old Series) 1123, Federal Reserve Bank of Cleveland.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:chosxx:v:30:y:2015:i:4:p:535-559. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/chos20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.