TRENDS IN DELINQUENCIES AND FORECLOSURES IN ......National Trends Even though NBER officially...

TRENDS IN DELINQUENCIES

AND FORECLOSURES IN

NEVADA

Community Development Research

Federal Reserve Bank of San Francisco

April 2011

National Trends

Even though NBER officially announced the recession’s

end in June of 2009, pace of recovery remains slow

In February 2011, unemployment rate fell below 9% for the

first time since April 2009

The private sector has been adding jobs at an average of 106,000

each month since February 2010

Housing is the one major sector of the economy where we still

do not see signs of recovery

New and existing home sales remain near historic lows, and

inventories of foreclosed homes remain very high

Public sector budget crisis in many states is of major concern,

and threatens viability of services to LMI communities

National Trends

Unemployment dips below 9%

Source: Bureau of Labor Statistics, November 2010

0

2

4

6

8

10

12

Recession

U.S. Unemployment Rate

Une

mplo

ym

entRate

Recovery, particularly in labor market, remains

elusive

Source: Bureau of Labor Statistics, December 2010

-7%

-6%

-5%

-4%

-3%

-2%

-1%

0%

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48

Perc

ent D

ecl

ine in E

mplo

ym

ent fr

om

Peak

Months Since Start of Recession to Employment Recovery

1980 1974 1981 1990

2007

Case-Shiller Index shows continued softness in

housing market

Source: Case - Shiller Home Price Index

100

120

140

160

180

200

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Case-Shiller National House Price Index(2000 = 100, Quarterly)

FHFA House Price Index Dips Again at End of 2010

FH

FA H

ouse

Pri

ce Index

2000=

100

Source: Federal Housing Finance Agency (formerly OFHEO), includes refinancing and is not seasonally adjusted

90

100

110

120

130

140

150

160

170

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FHFA (formerly OFHEO) House Price Index (2000=100, quarterly)

Nationally, delinquencies drop in 2010, but still

more than 4.5 million homes in distress

Source: Mortgage Bankers Association, National Delinquency Survey

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Num

ber

of

Mort

ga

ges

All Mortgages Past Due Loans in Foreclosure

Despite improvement, high rates of delinquency remain

concentrated in western and southern states

Source: Lender Processing Service Inc. Applied Analytics, November 2010

HAMP modifications down; borrowers still face challenges in

obtaining permanent modifications

Source: HAMP Service Performance Report Through January 2011

0

20,000

40,000

60,000

80,000

100,000

120,000

February March April May June July August September October November December January

Modif

ica

tions

New HAMP Trials Started New Permanent Modifications Started2011

Household debt falling from 2008 peak

Source: Federal Reserve Bank of New York

0

2

4

6

8

10

12

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Tri

llio

ns

of

Dollars

Total Debt Balance and Composition

Mortgage Auto Loan Credit Card Student Loan

Composition of distressed sales

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

Arizona and

Nevada

California Florida Industrial Midwest

Pacific NW South Northeast Rocky Mountain

Damaged REO Move-In Ready REO Short Sale

Source: Campbell/Inside Mortgage Finance HousingPulse Monthly Survey of Real Estate Market Conditions, Feb 2011

Neighborhood stabilization: concerns over

investor purchases of distressed properties

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Damaged REO

Move-In Ready REO

Short Sale Non-Distressed

Investor

First-Time Homebuyer

Current Homeowner

Perc

en

t o

f P

rop

ert

y T

yp

e

Who Is Buying Properties?─February 2011


30%

11%

75%20%

55%

2%

19%

14%

5%

4%

5%

28%

16% 18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Current Homeowners

First-Time Homebuyers

Investors

All Other Financing

VA

Fannie/Freddie

FHA

CashPerc

en

t o

f B

uyer-

Sid

e T

ran

sacti

on

sFinancing for home purchases


Many states within 12th District face severe budget

shortfalls

Total End-of-Year Shortfall as Percentage of 2010 Budget

Source: Data from Center for Budget and Policy Priorities

Nevada Trends

Unemployment rate in Nevada falls below14%,

still highest in country

Source: Bureau of Labor Statistics

0

2

4

6

8

10

12

14

16

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Recession

Une

mplo

ym

ent Ra

te

United States

Nevada

Unemployment in Nevada by county

Source: Bureau of Labor Statistics, January 2011

Nevada house prices falling to 2003 levels

Source: Federal Housing Finance Agency (formerly OFHEO)

FH

FA H

ouse

Pri

ce I

ndex

20

00

=10

0

90

110

130

150

170

190

210

230

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FHFA House Price Index (formerly OFHEO)

(2000 = 100, quarterly)

United States

Nevada

Las Vegas house price index down to 2001 levels

Source: Federal Housing Finance Agency (formerly OFHEO)

FH

FA H

ouse

Pri

ce I

ndex

20

00

=10

0

90

110

130

150

170

190

210

230

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

FHFA House Price Index (formerly OFHEO)

(2000 = 100, quarterly)

Las Vegas

Reno

Carson City

21

Housing boom was one for the ages

Source: Shiller, Irrational Exuberance

The number of distressed properties – delinquent

and in foreclosure – continues downward trend

Source: Mortgage Bankers Association, National Delinquency Survey

0

20,000

40,000

60,000

80,000

100,000

120,000

2005 2006 2007 2008 2009 2010

Num

ber

of

Mo

rtg

ag

es

Loans in Foreclosure All Mortgages Past Due

Nevada Foreclosure Data Maps

Areas Affected by Concentrated ForeclosuresJuly 2010

Nevada Data Maps

Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

Areas Affected by Concentrated ForeclosuresNovember 2010

Nevada Data Maps


Areas at Risk of Additional ForeclosuresJuly 2010

Nevada Data Maps


Areas at Risk of Additional ForeclosuresNovember 2010

Nevada Data Maps



Las Vegas Data Maps



Reno Data Maps


Conclusions

For More Information:

FRBSF Community Development Website

Links to other resources and research on foreclosure trends and mitigation strategies

All publications, presentations available on our website

Conference materials also posted shortly after events

http://www.frbsf.org/community/



TRENDS IN DELINQUENCIES AND FORECLOSURES IN ......National Trends Even though NBER officially...

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