Vacant Property Rates Soar In Over Half Of U.S. Local Housing Markets
According to a new report from ATTOM Data Solutions published earlier today, vacant property rates are once again increasing in many markets across the country but perhaps not for the reasons you might think. While so-called pre-foreclosure “zombie” properties have declined some 22% YoY, overall vacant property rates in 54% of the 149 metropolitan statistical areas analyzed by ATTOM actually increased due to, among other things, increasing ownership rates by investors as opposed to actual homeowners.
ATTOM Data Solutions, curator of the nation’s largest multi-sourced property database, today released its 2017 U.S. Residential Vacant Property and Zombie Foreclosure Report, which shows nearly 1.4 million (1,367,793) U.S. residential properties (1 to 4 units) were vacant as of the end of the third quarter of 2017 — representing 1.58 percent of all U.S. residential properties.
The 1.58 percent vacant property rate nationwide decreased slightly from 1.63 percent a year ago, but vacant property rates increased from a year ago in 81 of the 149 metropolitan statistical areas analyzed in the report (54 percent), including Chicago, New York, St. Louis, Baltimore and Phoenix.
The report also shows that the number of vacant “zombie” pre-foreclosure properties — which have started the foreclosure process but have not yet been repossessed by the foreclosing lender — decreased 22 percent from a year ago to 14,312 as of the end of Q3 2017, 67 percent below the peak of 44,030 in Q3 2013. The number of vacant bank-owned properties decreased 48 percent from a year ago to 24,026 as of the end of Q3 2017.
“Zombie foreclosures have dwindled dramatically over the last four years as a supply-starved housing has soaked up even some of the most highly distressed properties,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “There are still pockets of the country with high zombie foreclosure rates, and high vacant property rates in general, primarily in the Rust Belt and parts of the Northeast and Southeast — driven in large part by a high share of non-owner occupied vacant properties in those areas.
“There is evidence that the ultra-tight inventory environment in some red-hot markets is beginning to ease just a bit, with vacant property rates nudging higher in markets such as San Jose, San Francisco, Los Angeles, Boston and Denver,” Blomquist added.
Not surprisingly, some of the highest vacancy rates were observed in mid-western markets like Flint, Michigan and Baltimore.
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the highest vacancy rates were Flint, Michigan (6.89 percent); Youngstown, Ohio (4.49 percent); Beaumont-Port Arthur, Texas (3.80 percent); Detroit, Michigan (3.77 percent); and Mobile, Alabama (3.77 percent).
Among 405 counties with at least 50,000 residential properties, those with the highest vacancy rates were Baltimore City, Maryland (8.14 percent); Saint Louis City, Missouri (6.97 percent); Beaufort County, South Carolina (6.94 percent); Genesee County, Michigan (6.89 percent); and Wayne County, Michigan (6.76 percent).
Among 13,616 U.S. zip codes with at least 1,000 residential properties, those with the highest vacancy rates were led by three zip codes in the city of Gary, Indiana: 46409 (30.26 percent); 46407 (29.62 percent); and 46402 (29.53 percent), followed by 48505 in Flint, Michigan (29.00 percent); and 44507 in Youngstown, Ohio (25.97 percent).
And while “zombie” foreclosures are down nationwide, a staggering total of 14,312 properties in the foreclosure process remained vacant as of the end of Q3 2017, representing 4.2.% of all properties in foreclosure.
States with the most of these vacant “zombie” foreclosures were New York (3,528), New Jersey (2,261), Florida (1,963), Illinois (999), and Ohio (974).
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the most vacant “zombie” foreclosures were New York-Newark-Jersey City, NY-NJ-PA (3,106); Philadelphia, Pennsylvania (813), Chicago, Illinois (665), Miami, Florida (571), and Tampa-St. Petersburg, Florida (477).
Meanwhile, a stunning 24% of “investment” properties in Flint, Michigan found themselves without a tenet at the end of Q3 2017…
Nationwide more than 1 million non-owner occupied (investment) residential properties (1,032,851) were vacant, representing 4.30 percent of all non-owner occupied residential properties and unchanged from a year ago.
States with the highest vacancy rate for non-owner occupied (investment) properties were Michigan (9.84 percent); Indiana (9.52 percent); Kansas (7.11 percent); Mississippi (6.92 percent); and Alabama (6.83 percent).
Among 149 metropolitan statistical areas with at least 100,000 residential properties (1 to 4 units), those with the highest vacancy rate for non-owner occupied (investment) properties were Flint, Michigan (23.64 percent); Youngstown, Ohio (12.01 percent); Detroit, Michigan (11.88 percent); South Bend, Indiana (10.47 percent); and Indianapolis, Indiana (10.46 percent).
…which presumably makes them not such a great “investment”.