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Geoff Smith Foreclosing on Community: The Crisis and the Search for Solutions March 19, 2013

The Foreclosure Crisis and its Impact on Cook County’s Communities

© 2 0 1 3 I N S T I T U T E F O R H O U S I N G S T U D I E S AT D E PA U L U N I V E R S I T Y

Institute for Housing Studies

•  IHS’s mission is to provide reliable, impartial, and timely data and research to inform housing policy decisions and discussions about the state of housing in the Chicago region and nationally.

•  IHS accomplishes this through:

•  Data Collection •  Research •  Community Engagement

•  Today’s presentation

•  Foreclosure patterns •  Impacts on neighborhoods •  Looking forward

Percent of Properties with at Least One Foreclosure Filing, 2005 to 2011

3

Transforming Community – Concentrated Long Term Vacancy

4

40.4%  41.9%  

17.7%  

23.2%  

39.6%  

37.3%  

0.0%  

5.0%  

10.0%  

15.0%  

20.0%  

25.0%  

30.0%  

35.0%  

40.0%  

45.0%  

Low  Foreclosure  Areas   Middle  Foreclosure  Areas   High  Foreclosure  Areas  

Share  of  Addresses   Share  of  Long-­‐term  Vacant  Addresses  

Share of Total Addresses Compared to Share of Addresses Vacant More the 24 Months, 2012 4Q

Annual Property Sales in Cook County by Acquisition Method, 2005 to 2011

5

17,228   13,779   13,397   11,730  18,736   19,738   19,337  

99,826  

85,167  

58,512  

36,317  28,002   26,485   23,713  

0  

20,000  

40,000  

60,000  

80,000  

100,000  

120,000  

140,000  

2005   2006   2007   2008   2009   2010   2011  

Cash     Financed  

Transforming Community – How People Buy

6

16.4%   16.1%  19.8%   19.6%  

26.7%   29.5%  31.8%  

12.3%   11.6%  16.3%  

22.2%  

36.6%  42.0%  

47.1%  

16.5%   14.3%  20.8%  

39.6%  

67.8%   67.4%   68.0%  

83.6%   83.9%  80.2%   80.4%  

73.3%   70.5%  68.2%  

87.7%   88.4%  83.7%  

77.8%  

63.4%  58.0%  

52.9%  

83.5%   85.7%  79.2%  

60.4%  

32.2%   32.6%   32.0%  

0%  

10%  

20%  

30%  

40%  

50%  

60%  

70%  

80%  

90%  

100%  

2005   2006   2007   2008   2009   2010   2011   2005   2006   2007   2008   2009   2010   2011   2005   2006   2007   2008   2009   2010   2011  

Low  Foreclosure   Moderate  Foreclosure   High  Foreclosure  

Cash   Financed  

Residential Purchases by Method of Acquisition and Neighborhood Foreclosure Level, 2005 to 2011 

Transforming Community – Low Value Sales

7

1.3%  

3.5%   3.2%  2.7%   2.6%  

0.9%  

10.2%  

33.2%  

29.5%  

24.1%  23.3%  

0.0%  

5.0%  

10.0%  

15.0%  

20.0%  

25.0%  

30.0%  

35.0%  

2005   2006   2007   2008   2009   2010   2011   2012  

Low  Foreclosure  Areas   Middle  Foreclosure  Areas   High  Foreclosure  Areas  

Share of Total Sales That Were Less than $20,000 by Neighborhood Foreclosure Level, 2005 to 2012 3Q

Transforming Community – Business Buyers

8

7.4%  6.2%  

4.8%  5.8%   5.6%  

9.1%  10.2%  

8.3%  

5.6%   5.3%  4.7%  

7.7%  

10.8%  11.4%  

13.7%   14.2%  

11.3%  10.0%  

12.8%  

19.8%  

29.0%  27.7%   28.2%   27.7%  

0.0%  

5.0%  

10.0%  

15.0%  

20.0%  

25.0%  

30.0%  

35.0%  

2005   2006   2007   2008   2009   2010   2011   2012  

Low  Foreclosure  Areas   Middle  Foreclosure  Areas   High  Foreclosure  Areas  

Share of Total Sales That Were to Self-Identified Business Buyers by Neighborhood Foreclosure Level, 2005 to 2012 3Q

Transforming Community – Access to Credit

9

27.5  

24.8  

21.7  

16.3   16.5  

14.6  

12.5  

32.6  

29.4  

22.3  

13.2  

10.7  

8.8  7.7  

38.9  

36.3  

25.3  

13.1  

8.4  

5.8  4.9  

0.0  

5.0  

10.0  

15.0  

20.0  

25.0  

30.0  

35.0  

40.0  

45.0  

2005   2006   2007   2008   2009   2010   2011  

Low  Foreclosure  Areas   Middle  Foreclosure  Areas   High  Foreclosure  Areas  

Mortgage Originations per 100 Residential Parcels by Neighborhood Foreclosure Level, 2005 to 2012 3Q

Percent of Properties with at Least One Foreclosure Filing, 2005 to 2011

1 0

11

Where are neighborhoods headed?

1 2

40  

60  

80  

100  

120  

140  

160  

180  

200  

220  

1997Q1  

1997Q2  

1997Q3  

1997Q4  

1998Q1  

1998Q2  

1998Q3  

1998Q4  

1999Q1  

1999Q2  

1999Q3  

1999Q4  

2000Q1  

2000Q2  

2000Q3  

2000Q4  

2001Q1  

2001Q2  

2001Q3  

2001Q4  

2002Q1  

2002Q2  

2002Q3  

2002Q4  

2003Q1  

2003Q2  

2003Q3  

2003Q4  

2004Q1  

2004Q2  

2004Q3  

2004Q4  

2005Q1  

2005Q2  

2005Q3  

2005Q4  

2006Q1  

2006Q2  

2006Q3  

2006Q4  

2007Q1  

2007Q2  

2007Q3  

2007Q4  

2008Q1  

2008Q2  

2008Q3  

2008Q4  

2009Q1  

2009Q2  

2009Q3  

2009Q4  

2010Q1  

2010Q2  

2010Q3  

2010Q4  

2011Q1  

2011Q2  

2011Q3  

2011Q4  

2012Q1  

2012Q2  

2012Q3  

2012Q4  

Calumet  City/  Harvey   Chicago  -­‐  Lakeview/  Lincoln  Park   Chicago  -­‐  AusOn  

Chicago  -­‐  Garfield  Park/  Humboldt  Park   Chicago  -­‐  West  Town/  Logan  Square   Chicago  -­‐  Loop  and  Surrounding  

Chicago  -­‐  Bridgeport/  Brighton  Park   Chicago  -­‐  Bronzeville/  Hyde  Park   Chicago  -­‐  Chatham/  Woodlawn/  South  Shore  

Chicago  -­‐  South  Chicago/  Hegewisch  

Price Changes for Single Family Homes and Condominiums by Cook County Submarket, 1997 Q1 to 2012 Q4

Change in Household Tenure Choice Cook County, 2000 to 2011

1 3 35.0%  

36.0%  

37.0%  

38.0%  

39.0%  

40.0%  

41.0%  

42.0%  

43.0%  

0  

200,000  

400,000  

600,000  

800,000  

1,000,000  

1,200,000  

1,400,000  

2000   2005   2006   2007   2008   2009   2010   2011  

Renter-­‐Occupied   Owner-­‐Occupied   Rental  Rate  

© 2 0 1 3 I N S T I T U T E F O R H O U S I N G S T U D I E S AT D E PA U L U N I V E R S I T Y

Source:    2005  to  2011  American  CommuniOes  Survey  and  2000  US  Census  

Change in Renters Households by Income Level City of Chicago and Suburban Cook County, 2007 to 2011

1 4

17,788  

9,687  10,582  

4,307   4,224  

5,879  

12,391  

10,732  

5,464  

-­‐1,502   -­‐1,495   -­‐1,538  

-­‐5,000  

0  

5,000  

10,000  

15,000  

20,000  

<$20   $20-­‐34   $35-­‐49   $50-­‐74   $75-­‐100   $100+  

City  of  Chicago   Suburban  Cook  

© 2 0 1 3 I N S T I T U T E F O R H O U S I N G S T U D I E S AT D E PA U L U N I V E R S I T Y

Source:    2007  to  2011  American  CommuniOes  Survey  

Change in Supply of and Demand for Affordable Rental Housing Suburban Cook County, 2000 to 2011

1 5

123,700  118,842   118,794   119,398  

144,801  

87,328  

71,023   71,138   70,407  

85,176  

0  

10,000  

20,000  

30,000  

40,000  

50,000  

60,000  

70,000  

0  

20,000  

40,000  

60,000  

80,000  

100,000  

120,000  

140,000  

160,000  

2000   2005   2007   2009   2011  

Demand   Supply   Gap  

© 2 0 1 3 I N S T I T U T E F O R H O U S I N G S T U D I E S AT D E PA U L U N I V E R S I T Y

Source:    2005  to  2011  American  CommuniOes  Survey  and  2000  US  Census  

Change in Supply of and Demand for Affordable Rental Housing City of Chicago, 2000 to 2011

1 6

408,113  

342,488   336,067  

363,387   365,831  

338,638  

225,414   226,450   232,435  247,497  

0  

20,000  

40,000  

60,000  

80,000  

100,000  

120,000  

140,000  

0  

50,000  

100,000  

150,000  

200,000  

250,000  

300,000  

350,000  

400,000  

450,000  

2000   2005   2007   2009   2011  

Demand   Supply   Gap  

© 2 0 1 3 I N S T I T U T E F O R H O U S I N G S T U D I E S AT D E PA U L U N I V E R S I T Y

Source:    2005  to  2011  American  CommuniOes  Survey  and  2000  US  Census  

The Foreclosure Crisis and its Impact on Cook County’s Communities

1 7

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Foreclosing on Community: The Crisis and the Search for Solutions March 19, 2013